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REPORT

THE SECRETARY OF THE TREASURY

FROM THE

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ITS ORIGIN, GROWTH, AJiB P1VESEM COMUTION.

WITH

DETAILS OF WORK DONE, Ac.

BY S. M. CLARK,

CHIEF OF DIVISION.

NOVEMBER:

1864.

CAMDEN FURNITURE COMPANY

CAMDEN, ARKANSAS

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REPORT

THE SECRETARY OF THE TREASURY

FROM THE

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ITS ORIGIN, GROWTH, AND PRESENT CONDITION,

WITH

DETAILS OF WORK DONE, Ac.

BY S. M. CLARK,

CHIEF OF DIVISION.

NOVEMBER

1864 .

REPORT

THE SECRETARY OF THE TREASURY

FROM THE

FIRST DIVISION OF THE NATIONAL CURRENCY BUREAU.

Treasury Department,

National Currency Bureau, First Division,

November 26, 1864.

Sir : I have the honor to acknowledge the receipt of your instructions
to report “ the origin, growth, and present condition of this Division,
including the difficulties attending its organization, and render a state¬
ment of the amount of work done since its establishment;” and also to
give “ a detailed history of the method of producing the Government cur¬
rency and securities, and of the system of checks and balances adopted
for the security of the Government in that production;” and also to “state
what losses, if any, have occurred under your (my) management, and what
savings, if any, have been effected by it, with a statement of the compara¬
tive cost, security, and celerity of producing the work in the Department,
as compared with the former method of causing the work to be done by
contract in New York;” and to “state what legislation in your (my)
judgment is necessary, if any, for the future operations of the Division,
and make such recommendations for my (your) consideration as your (my)
experience in the work may dictate;” and also to “append a statement of
the amount of stock on hand at the time of rendering the report.

In reply I have the honor to report as follows:

ORIGIN OF THE DIVISION.

This Division had its origin in an attempt to trim and separate Treas-
sury Notes by machinery. This work, up to the summer of 1862, had
been executed by hand labor.

The first paper issues of the Government, made necessary by the exist¬
ing civil war, were manufactured by the New York Bank Note Companies,
and sent to this Department in sheets of four notes each. After they
were received here, the signatures of the proper officers were attached,
and they were then trimmed and separated, by hand labor, with shears.

It soon became apparent that the officers whose signatures were neces¬
sary—the Treasurer and the Register of the Treasury—were physically
unable to -write their names as rapidly and as many times as the neces¬
sities of the public service required. The authority of Congress was
therefore obtained to employ other persons to sign for these officers,
(Statutes at Large, vol. 12, p. 313,) and a corps of seventy clerks was
ultimately employed for this purpose, at salaries of $1,200 each per an¬
num, and placed under the care of the clerk then in charge of the Loan
Branch of the Secretary’s office.

Experience soon proved that so many different signatures to notes of
the same issue afforded very little security to the public. The cost of so
many signers also largely increased the expense of the issue. The pro¬
priety and economy of printing the signatures, by a peculiar process and
with peculiar ink, and of dispensing with written signatures, then sug¬
gested itself, and I reported to the then Secretary of the Treasury, Mr.
Chase, my belief that if the signatures were thus mechanically attached
they would offer greater security against counterfeiting than so many dif¬
ferent written signatures; and that an additional evidence of lawful issue
might be made with a copy of the Treasury seal, printed in the Treasury
building, on each Note, Bond, or Coupon issued. I urged this view to
him, orally, at different times, and endeavored to prove that it would pre¬
vent losses, both to the Government and the people, and largely lessen
the cost to adopt it.

Mr. Chase was favorably impressed with the plan, and opened a cor¬
respondence with the Assistant Treasurer at New York, and with other
gentlemen of large experience, in reference to the propriety and safety of
printed signatures in connection with a printed copy of the seal.

This resulted in his approval of the scheme, and an application to Con¬
gress for the necessary authority to carry it into execution. This

authority was given by act approved February 25, 1862,—(Statutes at
Large, vol. 12, p. 346.)

He then orally directed me to procure the necessary machinery to seal
the notes, and to design a suitable copy of the seal. I complied with this
order by procuring presses, specially made for the purpose, on approved
models, and by designing the copy of the seal now in use. This design
has for its interior a fac simile of the seal adopted by the Treasury De-
partment for its documents on a ground of geometric lathe work, the ex¬
terior being composed of thirty-four points, similarly executed. These
points were designed to he typical of the thirty-four States, and to simu¬
late the appearance of seals ordinarily affixed to public documents. It
was difficult of execution, and it was believed that counterfeiters could not
readily make a successful imitation of it. So far the belief has seemed
well founded, for it has not, that I am aware of, been successfully imi¬
tated. The American Bank Note Company of New York was employed
to make the original dies for seals of three sizes, which were satisfactorily
executed and paid for, as appears by their bills on file of September 30,
October 13, and November 9, 1862. They have since refused to surren¬
der these dies to the .Government, though they have been formally de¬
manded, and any additional price proffered that they might require.
Only duplicates made from these dies are now used in the Department,
the originals being still retained by the Company.

The following letter from the late Secretary of the Treasury was mailed
to the American Bank Note Company in New York, at its date, in refer¬
ence to these dies:

Treasury Department,

October 7, 1863.

Sir : I have yours of the 6th inst. advising me that I have been errone¬
ously informed in reference to payment for the seals for legal-tender notes.

In your bill of 30th September, 1862, and 29th November, 1862, you
have charged for “ engraving seventy-four (74) medium size steel seals
and fifty-eight large size,” $1,320.

As you charged for the engraving , it was supposed the engraving was paid
for, for it was thought this charge could hardly be for transferring alone.

The dies for the three sizes—large, medium and small—I desire should
be transmitted to the Department, and will thank you so to transmit them.

If any or all of them have not been paid for, a proper price will be
paid for them on delivery.

Very respectfully,

S. P. CHASE,
Secretary of the Treasury.

Geo. W. Hatch, Esq.,

President American Bank Note Company.

This request not being complied with, I was sent to New \ork to make
a personal demand for the dies. I made the demand, as directed, upon
the President and Vice President of the Company, and told them that
any price they might demand would be paid for the originals. They
emphatically refused to surrender them at any price, but offered to fur¬
nish duplicates at ten dollars each. I therefore bought one set of dupli¬
cates of each of the three sizes, and have produced from them all that
have since been used in the Department. The duplicates produced have
not cost the Department so much as fifty cents each.

The refusal to surrender these dies was probably based upon the ex¬
pectation of being able, by retaining them, to furnish, at the price de¬
manded by their Company, all the duplicates this Department might
require. When the necessity for the employment of the Company for
this purpose passed away, no sufficient motive appeared for their longer
retention by the Company. The Secretary is of course aware that from
these originals, workmen can produce duplicates rapidly and cheaply by
the process of transferring. Thus the only evidence of lawful issue pre¬
scribed by Congress, is within the power of cheap reproduction by any
evil disposed workmen who can get access to the. dies. It is, therefore,
in my judgment, manifestly improper that they should be out of Treasury
control. Without here questioning the trustworthiness of the officers of
the Bank Note Company, or their motives in refusing to surrender the
original dies, it seems to me imperatively necessary for the Government’s
protection, that all these originals and their duplicates should be in the
Treasury vaults. Under this conviction, and all other means of obtaining
them failing, I respectfully recommend that proper legislation should be
asked from Congress to enforce the delivery of all dies to the Treasury
which are now retained by the Company.

The trimming and separating of the Notes with shears also appeared to
me to involve unnecessary expense. About seventy-five females were
employed, at salaries of fifty dollars per month each, for the purpose, and
placed under the charge of an officer specially appointed for that duty.
The process was found to be both tedious and expensive, and, after much
reflection, I suggested to Secretary Chase that the issues might be more
economically and more speedily trimmed and separated by machinery.

Upon receiving the assurance of my belief that I could devise machines
for the purpose, he authorized me to construct two for trial—one for
trimming the edges of the sheets, and the other for separating the notes
from each other (which were printed four on a sheet,) and trimming the
sides.

The machines were accordingly made, to be propelled by turning a
crank, and placed under the direction of the clerk then in charge of the
Loan Branch. This clerk was not only ignorant of everything relating
to machinery, but had early contracted a prejudice against the use of
automatic note-cutters, which was shared and sustained by some of the
officers of the Treasury. It was feared by them that the introduction of
machinery for this purpose would throw many deserving females out of
employment, which they thought an evil not compensated by any economy
of cost that would result from their use. This view has generally ob¬
tained against all labor-saving machinery, upon its first introduction, by
those immediately interested in the labor. But the history of mechanic
art shows that a contrary result is generally attained. The effect of all
labor-saving machines has been to increase production, and thus ultimately
to employ more labor. These note-cutting machines have proved no ex¬
ception to the general rule, for they have been the nucleus of a business
which now employs more than five times as many females in the Treasury
as were employed when they were first introduced, although for the par¬
ticular operations for which they were designed, not one-fifth as many are
now employed. If these machines had not then been put in use, or some
efficient mechanical substitute adopted in lieu of them, the Treasury
building would not have afforded room enough for all the hand labor that
would have been required to seasonably prepare the subsequent issues.
But the germ of opposition thus engendered among Treasury officers has
grown with the growth of the work, and still exists to a large extent in
the Department. Different officers, from time to time, remonstrated with
Secretary Chase, and caused apprehensions in his mind which seriously
interfered with his efforts to produce the paper issues of the Government
more economically.

The clerk then in charge of the work, after a trial of the machines,
erroneously reported to your predecessor that they were a failure, and
that they could not do the work as rapidly or as well as it was done by
hand. Upon this report the Secretary issued an order to discontinue
their use, and remove them from the building. Pending the execution
of this order, he examined, at my request, the machines while at work,
and being satisfied from this examination that the report upon which his
order was issued was not sustained by the facts, he rescinded the order,
and directed me to submit a programme for taking the small notes (one
and two dollars) under my charge, in a separate room, to trim and separate
them by these machines, propelled by steam power.

In accordance with this direction I prepared and submitted a pro¬
gramme for the work on the 10th of April, 1862.

At this date I had no official connection with the preparation of the
Government issues, and therefore no official record wa's made of this report.

I am informed by the Secretary’s clerk that it has since disappeared
from the files, so that I am, to my great regret, unable to reproduce it
here.

It contained, among other details, a statement of the proposed machinery
and its probable cost, with the number of operatives to be employed, the
nature of the work, rate of wages, and supposed amount of work they
could perform with the machines.

This project was held under advisement by Mr. Chase until the follow¬
ing August, when, on the 20th of that month he approved it, directing
me to prepare a letter of instructions for my guidance in carrying out
the project, and submit it for his approval. Under this direction I pre¬
pared the following, which was adopted and signed by him at its date:

Treasury Department,

August 22, 1862.

Sir : You are hereby instructed to take charge of the preparation for
the issue of the one and two dollar Treasury Notes, in accordance, as
near as practicable, with your programme, now on file, of the 10th of
April, 1862.

This order is not issued as a permanency. It is my intention to give
the experiment of machinery a full and fair trial, and this order is issued
for that purpose.

A reasonably sufficient time will be given for a fair trial, and my future
orders will depend on the result of that trial. If it is not more economi¬
cal and better than the present method, its use will not be continued.

You will, therefore, on and after Monday next, receive from the mail
the one and two dollar notes, making the customary receipt therefor, and
after sealing and trimming deliver them to the Treasurer, and take his
receipt. You will keep a perfect record at every step, using all the
checks and guards now used in the organization for larger notes, with
such additional checks as you may deem proper that do not involve addi¬
tional cost, and may seem to you additional security. You will make a
daily report of the amount of notes on hand, amount received from the
engraver, the amount delivered to the Treasurer, and the amount in your
hands at the close of work on each day, showing under each head the
respective quantity of ones and twos, and also aggregating the total
amounts of all bills received from the engravers up to the date of the
report, with the respective amounts of ones and twos.

You will also keep a daily record, in a book prepared for the purpose,
of each day’s work, and its cost, for which you will render a weekly
statement, or if hereafter ordered, a daily statement.

The sealing press in the hall, which has been ordered* up stairs, you
will now remove below, together with the new counter shafts and pullies
designed for the new presses, and place them with the two presses ordered,
in the room below, adjacent to the cutters.

Very respectfully,

S. P. CHASE.

Secretary of the Treasury.

S. M. Clark, Esq.,

Chief Clerk Bureau of Construction.

I at once addressed myself to the work, and during the next suc¬
ceeding six days procured and set in place a steam engine and boiler,
with the necessary shafting, pullies, and other fixtures, and set up in the
southwest room of the basement of the south wing the presses, trimmers,
and separators ready for use.

On the 29th day of August, 1862, I commenced the work with one
male assistant and four female operatives.

This was the small beginning of the* present vast work in the Treasury.
I assumed the charge of it with nothing but my belief in its economy to
encourage me, under much opposition, and with great dread of the mag¬
nitude of the trust which was necessarily imposed upon me; as the prob¬
able amount of money to be handled, by perhaps twenty or more opera¬
tives, with as yet a new and untried system of checks, seemed likely to
exceed a hundred thousand dollars per day.

This was a source of ceaseless anxiety to the Secretary as well as to
myself. Had I then supposed that the business would have grown under
my charge to its present enormous magnitude—the current issues having
sometimes exceeded sixteen millions of dollars in a single day, handled
by more than five hundred operatives, I should have been impelled to
shrink from the task and abandon the attempt.

The result of this attempt in respect of the execution of the work and
its economy, appears in my report to the Secretary of the Treasury dated
January 5, 1868, which was as follows:

Treasury Department,

Bureau oe Construction,

January 5, 1863.

Sir : I have the honor to report that the engravers have reached their
proposed maximum delivery of one and two dollar notes, say thirty-six
thousand impressions, (or $192,000) per day, and I take occasion to re¬
port the present condition of trimming and sealing them.

We now trim, seal, and separate, each day, the same quantity as re¬
ceived from the engravers, viz: thirty-six thousand impressions. ' We
commenced work upon twelve thousand impressions per day, and in my
2

original programme for the work I stated that the machines, when the
operators became expert, would do thirty thousand impressions in ten
hours’ work. So expert have the present operators become, that they
now do thirty-six thousand impressions in eight hours’ work. I stated in
the original programme that the pay-roll for thirty thousand impressions
would not exceed $1,700 per month. It has not yet in any month
amounted to $1,000. The present cost of trimming and separating by
machinery is forty-eight cents per thousand sheets. The cost reported
from the Loan Branch, by the old method, is $2 40 per thousand. My
cost for sealing is twenty-six cents per thousand. The Loan Branch re¬
port of its cost for sealing is fifty-one cents, thus effecting a saving of
nearly $2,000 per month to the Department in the issue of small notes
alone. To be able to report this result gives me more gratification than
any pecuniary compensation could possibly give, more especially as I am
able to report that the work for the entire amount ($11,748,000) has been
accomplished without the loss of a single dollar.

The operatives now work “by the piece,” as it is technically termed—
i. e., a given price per thousand impressions for each operator. They
earn from $1 20 to $1 80 per day, depending upon their skill and industry,
and the amount earned will increase as their dexterity increases. I bear
willing testimony to the diligence and faithfulness of the employees, who
have zealously seconded my efforts to produce this result. Without such
aid I should not have succeeded.

The machines are doing as much per day as should be expected from
the operators. As these gain in skill, they will lessen the hours of work.
But if much additional work is desired, more machines would be required.
The cost of counting cannot, I think, be judiciously reduced. It could
only be reduced by lessening the number of counts; and the present sys¬
tem having so far proved a security against loss, I should hesitate to re¬
commend any change which looked only to reduction of cost without
increase of security.

I have the honor to be, very respectfully,

S. M. CLARK,

Chief Cleric, in charqe.

Hon. S. P. Chase,

Secretary of the Treasury.

GROWTH OF THE DIVISION.

During the progress of the work, from its commencement in August,
1862, to the time when the above report was rendered, your predecessor
gave earnest personal attention to the working of the system adopted,
and, despite of the representations of parties whose interests were
affected, and of their aiders and abettors in the Department, he became
convinced of its safety and economy. After the rendition of the above
report of the actual result, he ordered me to take charge of the work for

all denominations of notes. This was immediately done, the sealing
presses were removed from the Loan Branch room to the room occupied
by me in the basement, more machinery for trimming and separating
added, and from that time to the present all the notes, bonds, and other
securities issued by the Department have been sealed, trimmed, and
separated by machinery in this Division, except a portion of the Frac¬
tional Currency.

Pending this action, Mr. Chase had orally directed me to see what other
economies I could suggest in connection with the work of producing the
Government issues of notes and securities. My attention was thus called,
for the first time, to the cost of their production. Up to that period I had
seen neither the contracts nor the invoices of the Bank Note Companies.
Upon examining these, I was amazed to find the enormous prices that
had been paid for the work, and reported to the Secretary that, in my
judgment, he was paying a rate vastly disproportionate to the service
performed. From my representations he apprehended this might be
true, but there appeared to be no remedy for it, as the two companies
then executing the work—the “American” and “National” Bank Note
Companies of New York—were practically but one, and, in the judg¬
ment of Mr. Cisco, the Assistant Treasurer at New York, to whom the
whole matter of contracting for the Government issues had been early
referred, they were the only parties competent to execute the work.
That they were practically but one, appears from the record, as they have
acted in concert in making proposals and in executing contracts.

These companies were formed by a coalition of all the bank note estab¬
lishments of any repute in the different cities, and controlled nearly all
the talent, capital, and experience which had been used in producing the
circulation of the State banks for a period of forty years. The combi¬
nation of the two therefore formed a powerful monopoly, to whom alone,
in Mr. Cisco’s judgment, the Secretary could look for his issues, and they
were thus enabled to dictate terms. There was, apparently, no escape
from the grasp of these monopolists. The use made of their power may
be inferred. The American Company is reported to have been originally
formed with a cash capital of five thousand dollars, according to the certi¬
ficate filed to procure an act of incorporation from the State of New
York, and to have created a nominal capital of one million two hun¬
dred and fifty thousand dollars, represented by shares, freely distrib¬
uted in influential quarters, but which, up to the time of its employment
by the Government had not reached a par value in the share market.

After the employment of the company by the Government to engrave
and print its paper issues, it divided, as I was informed by its share¬
holders, thirty per cent, per annum on its nominal capital of one and a
quarter millions. And this result may doubtless be, in part at least,
attributed to the Government’s necessities in a time of civil war.

The subject engaged the thoughtful attention of your predecessor, who
was anxious that the necessary paper issues should be procured at a rea¬
sonable cost to the Government, while they should, at the same time,
yield a fair and remunerative return to the producers. His efforts to
this end only resulted in procuring a small abatement of the companies’
demands, and still left the prices paid unreasonable and exorbitant.

After earnest thought, and a careful canvassing of all the facilities that
might be obtained, I reported to Secretary Chase that, if clothed with the
proper authority, I thought I could produce the work in the Department
for a comparatively small outlay, at a great saving of cost in the issues.
He carefully and critically examined my plans, and being encouraged by
the success attained in economizing that portion of the work necessarily
done in the Treasury building, under my direction, orally instructed me
to mature the plan and prepare designs for the purpose.

Authority to execute the work in the Department was given by the 2d
section of the act of Congress, approved July 11, 1862. (Statutes at
Large, vol. 12, p. 532.)

I then revived the suggestion, which I had made to the Secretary in
the winter of 1861-2, to adopt for designs the national pictures in the
Capitol, using them in their chronological order, the earliest events pic¬
tured for the smaller denominations, and the later events for the larger
notes. This plan the Secretary had, at different times, submitted to
leading members of Congress, to eminent bankers and financiers at the
North, and others, and it seemed to meet the approval of all who exam¬
ined it. The Secretary therefore adopted it, so far as the one, two, and
five dollar notes were concerned, directing Vanderlyn’s painting of the
“Landing of Columbus” to be used for the ones, Weir’s painting of
the “Embarkation of the Pilgrims” to be used for the twos, and Powell’s
painting of the “Discovery of the Mississippi by De Soto” for the fives.
The engraving of these three plates, of note size, was nearly completed
when the necessities for other and more immediately needed issues com¬
pelled the suspension of the work upon them, and they now remain in
their then unfinished state. But little work, comparatively, is required
to finish them, and it is now designed to complete and put them in circu-

lation as early as practicable, in fulfilment of the order of your prede-
cessor, in substitution for the present issue of United States Notes, which
will then, unless the present Secretary should change the order of his
predecessor, be called in and destroyed.

This design has since been partially carried out upon the currency
of the National Banks, but only partially, as my original design con¬
templated the engravings from the paintings to be of the full size of
the note, as a safeguard against their alteration from a low to a higher
denomination; this result of the present issue of United States Notes, as
made by the Bank Note Companies, being the most fruitful source of
loss to the public. The day fixed by the advertisement for opening the
designs submitted pursuant to its call, for the currency of the National
Banks, was the 28th of March, 1863. On the preceding day the Secre¬
tary directed me to reduce my suggestions for these designs to writing,
and submit them with the proposals offered, to be opened at the same
time, that they might become of record. The following communication
was therefore addressed to him at its date, and opened with the propo¬
sals, but probably never read by him, as I was informed that payment
was made to another person on a proposal to use historic pictures upon
the National Currency.

Washington, March 28, 1863.

Sir : I respectfully suggest as a design for a National Currency the
engraving of national historic pictures of the full size of the note to be
issued, and submit, as “a model of illustrative drawing,” a two-dollar note,
made up of a copy of Weir’s painting of the “Embarkation of the Pil¬
grims,” with a suitable reverse.

I claim that this style of note possesses greater security against coun¬
terfeiting and alteration than any device yet in use.

First. If the note be engraved in the highest style of art, its different
portions, such as etching, portraits, lettering, drapery, &c., executed by
those who have made these portions respective specialties, it will present
an amount of artistic labor to be accomplished by the burin which would
appal and stagger counterfeiters in the outset, even if they possessed the
requisite talent and skill to counterfeit it. As there is a peculiarity in
the engraving of every proficient of high art, (as easily detected by an
expert as different styles of handwriting,) such a note, properly executed,
could not be counterfeited so as not to be readily detected by the skilful.
The notes now in use, made up of separate dies, actually afford facilities
for counterfeiting, from their patch-work composition, while a note made
from a single die, of its whole size, and not repeated in parts, presents
difficulties of counterfeiting almost in geometric ratio to its increased size
from a mere vignette.

To make a note’s genuineness apparent to the unskilled, additional

methods are suggested. To counterfeit it by photography, which is the
readiest way to deceive the masses who handle notes, particularly those
who most receive and pay small notes, a non-photographic material should
be introduced into, and be inseparable from, the paper, so that a photo¬
graph or phototype should present a defaced or mottled appearance,
easily distinguished by all. A sample of paper thus prepared is submitted
for the Secretary’s inspection.

Second. 'I claim that my suggestion would, if carried into effect, be a
complete protection against alterations. Alterations, as the Secretary is
aware, are the most numerous, as well as the most dangerous of frauds,
far exceeding in number and danger all counterfeits; and in the multi¬
form issues which now fill the channels of circulation, comparatively no
protection is given except to those who are skilled in the art, and make
their detection a study. But if a two-dollar bill is always the picture of
the “Embarkation of the Pilgrims,” and a ten-dollar bill is always the
picture of “Washington crossing the Delaware,” the public, even those
who cannot read, as well as those who do not understand our language,
or who cannot distinguish its numerals, will soon educate themselves to
these facts in handling the money, so that they could never be deceived
into taking one denomination for another, though the figures or letters
denoting the denomination of the note were ever so cleverly altered. The
skilful can protect themselves, but the unskilful require something plain
and patent to the senses. I claim that my National Picture Currency
furnishes this desideratum.

Third. A lesser but not unimportant advantage of such a currency
would be, that a series properly selected, with their subject titles im¬
printed on the notes, would tend to teach the masses the prominent pe¬
riods in our country’s history. The laboring man, who should receive
every Saturday night a copy of the “Surrender of Burgoyne” for his
weekly wages, would soon inquire who General Burgoyne was, and to
whom he surrendered. His curiosity would be aroused, and he would
learn the facts from a fellow-laborer or from his employer. The same
would be true of other national pictures, and in time many would be
taught leading incidents in our country’s history, so that they would
soon be familiar to those who would never read them in books; teaching
them history, and imbuing them with a national feeling. Thus a series
of pictures of full note size might be selected, beginning with the earliest
scenes of savage life, and terminating in the advanced stages of civiliza¬
tion, which would be an illuminated history of the country’s progress; or
a series beginning at bow and arrow warfare, and terminating in a per¬
fected iron-clad; or a series beginning at the earliest modes of journey-
ing in the birch-bark canoe, and terminating in the present perfection of
steam craft; or a series illustrating methods of payment, beginning at
exchanges of values by shells and wampum in uncivilized tribes, and ter¬
minating in Coupon and Registered Bonds and Treasury Notes, as dealt
from a modern banking-house.

The reverse of the note, as exhibited on the model, possesses, as now
drawn, no distinctive merit, except that it is “national in its character,”

and is an appropriate design, and there are intended to be as many cir¬
cular counters as the note represents dollars—one counter on a one-dollar,
two on a two-dollar, five on a five-dollar, &c. It should be executed in
the highest style of art, similar to the obverse. I design to fill the
counters now in blank with a non-counterfeit composition, which cannot
well be exhibited in drawing, and can only be clearly manifest in actual
execution. But I have prepared a photographic approximation of it for
the Secretary’s inspection. A blank tablet is left for the legend, which
can be differently filled for the different issues, as the acts of Congress
may require.

I propose, also, to print upon the obverse of the note its denomina¬
tion, date of issue, and Treasury seal, with the coat of arms of the State
where the association is located, in gold characters, peculiarly attached,
so as to be absolutely irremovable, before printing the note proper. This
is an additional safeguard against photography and alteration, makes the
denomination of the note more discernible in a dim light, and when held
between the eye and light appears in bold black characters, vastly more
discernible and more enduring than any water-mark. A specimen thus
prepared is ready for the Secretary’s inspection.

There has not been time to prepare a full series of notes, but I have
made preparations for them, which can be easily completed if the Secre¬
tary should adopt my suggestions.

I have the honor to be your obedient servant, &c.,

S. M. CLARK,

Hon. S. P. Chase,

Secretary of the Treasury.

Chief Cleric, in charge.

This plan was, however, partially adopted by using the national pic¬
tures as designs for vignettes on the backs of the notes. The proposals
of two companies, the Continental and American, were subsequently ac¬
cepted. I had prepared, under Mr. Chase’s instructions, the letters in¬
viting their proposals, and subsequently drafted the contracts made after
the proposals were accepted. These contracts will be found in the Ap¬
pendix, marked A and B.

I was careful, in drafting these letters inviting proposals and in the
Original draft of the contract, to fully cover the point that all the dies or
bed-pieces, and original cuttings of lathe-worlc, together with all rolls and
transfers, should be the absolute property of the Government, and be
under the exclusive control of the Comptroller of the Currency. I was
not then aware of the Comptroller’s views as to printing in the Treasury.
The phraseology used in the letter inviting proposals was as follows:

“ You will please state prices separately, for the dies or bed-pieces, for
the original cuttings, for the rolls, and for the transferred plates, for each
denomination by itself; all to become the property of the Government if

your proposals are accepted, and their custody to be under the exclusive
direction of the Comptroller of the Currency.” ^

In response to this, the company submitted proposals, closing them
with the following declaration:

“ It is understood that all the stock, original cuttings, dies, and bed-
pieces, transfers, and rolls, shall immediately become the property of and
be subject to the order of the Department.”

The original draft of the contracts was in accordance with the above
terms, but was subsequently altered, not by me, so as to give the companies a
right “to hold and safely keep them,” they being, however, so held “sub¬
ject to the order of the Comptroller.” I was the more careful in seek¬
ing to place this point beyond cavil, because it had been overlooked in
the papers drafted by those who had charge of the work prior to myself;
and because, in consequence of this omission, the companies claimed to
hold, and now still claim and hold, all the stock and plates from which
those earlier issues were printed. They found their claim on a printed
clause attached to their “ bill heads,” in sending invoices, and in this view
of their right, under those earlier papers not prepared by me, they are,
perhaps not improperly, officially upheld by some of the present officers
of the Treasury.

Your predecessor took a different view of the rights of Government in
the premises, and frequently stated to the officers of the company as
well as to members of Congress, that the Department owned the plates.
But he vainly sought to obtain them from the companies. So far was the
controversy at one time carried, that the company packed up their dies
with a view to sending them out of the country, (as appeared in evidence
before a Congressional Committee,) fearing that your predecessor would,
by process of law, obtain them.

I sought by careful wording of the letter inviting proposals, and by the
original draft for the contracts, to avoid any doubts thereupon in future
as to the ownership and custody of all the engraved stock and plates.

The result is, that though owned by the Government, all the rolls, dies,
and plates, and all original or transferred work, for the currency of the
National Banks, in defeat of the original plan as drafted by me, are in
the custody of the Bank Note Companies, by the Comptroller’s authority,
at a distance from the seat of Government, and not in possession of the
Department, though they are subject to the Comptroller’s order.

The production of the Postal Currency, as it was then called, next en¬
gaged your predecessor’s attention. The price paid for it was largely
disproportionate to the cost of the production. In his own language,

“though bearing no interest, it was the dearest loan.” He directed me
to investigate the mattes, and, if I found that any economy, with equal
security, could he attained by any other method of production, to report
the result of my investigations to him. I reported to him, orally, from
time to time, as my investigations progressed. These investigations
seemed to prove that a large economy and greater security could be ef¬
fected by producing the currency in the Treasury. He therefore instructed
me to mature the details for an issue in the Department to be called a
Revenue Currency, in place of the Postal Currency then in circulation,
and report the result in writing for his consideration. In October, 1862,
I reported as follows :

Treasury Department,

Bureau of Construction,
October 7, 1862.

Sir : I have the honor to report that I have matured the details for
carrying out the Secretary’s plan of supplying the place of the present
Postage Currency, with a currency based on the issue of revenue stamps,
as follows:

Upon the Secretary’s suggestion that the size of all denominations shall
be the same as the present 10 cent Postage Currency, I respectfully re¬

commend that—

A sheet of 5 cent stamps contain.50 or = $2 50

A sheet of 10 cent stamps contain.50 or = 5 00

A sheet of 25 cent stamps contain.40 or = 10 00

A sheet of 50 cent stamps contain.40 or = 20 00

and that the proposed issue of $100,000 per day be divided as follows:

8,000 sheets, 14x19 inches, of 5 cents = .$20,000

4,000 sheets, 14 x 19 inches, of 10 cents = . 20,000

2,000 sheets, 14J x 16 inches, of 25 cents = . 20,000

2,000 sheets, 14^x16 inches, of 50 cents = . 40,000

16,000 $100,000

The obverse of all denominations I would print in black, and the re¬
verse in four different colors; say 50’s red, 25’s purple, 10’s green, and
5’s tan color.

To print 16,000 sheets per day, (if the obverse is of plate-printing, and
the reverse of surface-printing, which I very decidedly recommend,) there
would be required—

Thirty 22 inch copper-plate presses.

Ten 18 inch copper-plate presses.

Four Gordon presses for surface-printing, similar to those now in use
for Bonds.

To trim and separate 16,000 sheets per day, there would be required
five trimmers and ten separators.

The power presses, with the trimmers and separators, could be moved
by the same power, and in the same room, now used for the small note
machinery, without disturbing the present arrangements, except that the
present work would require to be suspended for a few days, while the
additional machinery was being put in place.

The plate presses, which would be worked by hand, (and for which I
do not think machinery can be substituted, as it requires the varied action
of the brain as well as the hand at each printing,) could be placed in a
portion of the new attic, designed for the west wing, to and from which
the paper could be elevated, and the printed sheets lowered, by a dumb
waiter, constructed in the southeast corner, on the extreme court yard side.

The engraving of the bed-plates could all be done in the Department
by three artists, and would take about thirty days. After the bed-plates
were made, eighty-four plates would be required; these could be made
by one transfer press, to be worked day and night, which would make
one plate by day and one by night; taking forty-two days to produce
the eighty-four plates, making say seventy-two days in all; but in view
of possible failures, I should think it safe to say it would take three
months.

I have a design prepared for the Secretary’s inspection, whenever he
has time to examine it.

The trimmers and separators, with the paper, &c., could all be pre¬
pared within the same period.

The cost of the whole, presses, cutters, separators, &c., with fixtures,
I estimate, will be less than $20,000. The machinery I make about
$16,000, and allow $4,000 for fixtures and contingencies. Making the
paper would be in addition to this.

I respectfully suggest that the product be packed in neat paper boxes,
in packages of $10, $20, and $50 each, which boxes, for transmission,
could be packed in hermetically sealed tin boxes, in such quantities as
may be required, and then enclosed in wooden cases for transportation.

if these details meet the Secretary’s approval, I respectfully recom¬
mend that Mr. Neale be placed in charge of the printing department, at
a proper compensation, to be under my general direction, and that he be
immediately detailed to go to Philadelphia and New York, &c., to secure
the necessary plate presses and workmen. The press workmen would be
hired u by the piece,” probably at not over 75 cts. to $1 per 100 sheets.
(The Secretary can compare this price with the price paid for printing
to the Bank Note Companies.)

I further respectfully recommend, as it is impossible for me to get
away from Washington until the small-note room is more perfectly sys¬
tematized, and operatives more experienced than now, that I be authorized
to send for such parties to confer with as may be necessary, or to send
parties to them if desirable.

I respectfully suggest to the Secretary, if these details are to be
carried out, that he should give me some title — ( not to carry any pay—
but) to give more of an air of official authority, than a naked signature
will carry.

If the Secretary approves this project, and endorses it, I will take
immediate steps for its prosecution. How soon Mr. Rogers will get his
new roof ready, so that the attic can be occupied, I can only conjecture;
he will, doubtless, anticipate finishing it before it will be needed, but I
have much fear that he will be disappointed.

I have the honor to be, very respectfully, your obedient servant,

S. M. CLARK,

Chief Cleric , Bureau of Construction.

Hon. S. P. Chase,

Secretary of the Treasury.

The Secretary adopted the report on the 10th of October, 1862, and
approved the design. This design was made larger than the Postal Cur¬
rency, viz: 2J by 4 inches. I recommended the use of this size instead of
the smaller size he had prescribed. The Secretary was adverse to the
adoption of this larger size, but directed me make a written report of 1110
comparative cost of the two sizes, and of an intermediate size, when he
would consider the matter. I complied with his directions as follows:

Treasury Department,

Bureau of Construction,
October 10, 1862.

Sir : In compliance with your oral instruction I have the honor to
report that I have made an elaborate calculation of the probable cost of
a Revenue Currency, with the following result, viz :

An issue of $100,000 daily of the denominations and size approved by
the Secretary, viz: 2 9-15 by 1 25-32 inches, the size of the present 10
cent Postage Currency, in the following proportions, viz :

$20,000 of 5 cents, $20,000 of 10 cents, $20,000 of 25 ceiits, and
$40,000 of 50’s, would require 16,000 sheets daily of the respective sizes
of 14 x 16 and 14 x 19 inches.

I estimate that the cost of engraving, of steel for plates, of transferring,
of re-entering, divided on one year’s issue; of plate-printing and ink
therefor; of surface-printing and ink therefor; of paper ; of trimming
and separating; of counting and packing ready for transportation; to be
$37 17 per 1,000-sheets. If we call it $40 it will be sixteen twenty-fifths
of one per cent on the amount issued.

A like issue in amount, of like denomination, of the size which I have
suggested to the Secretary, would require 36,000 sheets daily, and by the
comparative computation, would cost $83 63. If we call it $100 it would
be one and one-tenth of one per cent on the amount issued, thus making
the larger notes cost about 21 times as much as the smaller.

[By the use of steam-power for plate-printing, which would enable me
to use larger plates, and thus lessen the number of sheets, I thinlc the
cost would be reduced about one-third. I base this supposition as a re¬
sult reported to me, of the use of steam-power for printing the present

revenue stamps. I have no practical knowledge of its use. It is a recent
introduction, but I am told that the stamp contract, which would have
netted a loss by hand-power, is proving profitable by steam-power. I am
credibly informed of this, but do not report it as the result of my own ex¬
perience or knowledge.]

Many of the details of my estimate are, from their nature, conjectural;
others are approximations; but adopting the same rules for both esti¬
mates, the errors will be much the same in each, and I think the estimate
sufficiently near for comparison. But I do not feel warranted in advising
the Secretary that the larger size can be produced much, if any, less than
twice the cost of the smaller.

The adoption of my suggested size would also protract the time at
which the issue of $100,000 could be reached. I could begin the issue
as early as indicated in my report of the 7th inst., but it would take at
least sixty days more, after beginning the issue, to attain $100,000 per
•Jay- I could begin issuing say $40,000 per day, and increase it about
$1,000 per day thereafter.

Upon the Secretary’s directions, that convenience, appearance, and
similar matters, must yield to economy, I think my report will be con¬
clusive against myself, as to my own projected size, and therefore do not
delay the report to make the third computation in detail for an inter¬
mediate size. I think, however, that an intermediate size would probably
cost about 1} times as much as the Secretary’s suggested size, or about
$b0 per thousand sheets, or ninety-six one-hundredths of one per cent
of the amount issued. 1

I respectfully apprise the Secretary that these estimates are designed
to cover every cost, from the present moment to the readiness for pay¬
ment over the counter of the Treasury. J

I have the honor to be, very respectfully, your obedient servant
S. M. CLARK,

TT „ Chief Clerk, Bureau of Construction..

Hon. S. P. Chase,

Secretary of the Treasury.

Upon this report he decided to adhere to the size originally prescribed
by him, and directed me to take immediate steps for its preparation, by
causing the design which he had approved, to be reduced, by photography,
to his prescribed size. This was unfortunate for the artistic merit of the
design, as it crowded the face of the note with engraved work, leaving
less light in the composition, and consequently making the whole more
obscure. But it certainly promoted the economy of the issue, as the
actual cost proved a little less than my estimate, as detailed in the above
letter of October 10, 1862, and was less than one-fourth what the
Postal Currency from the New York Bank Note Companies had cost.
My estimated cost was $640 for each one hundred thousand dollars pro¬
duced—the actual cost, as appears by the record, was $545 62, while

the cost of the Bank Note Companies product was $2,257. He also
directed me to prepare and submit a system of checks upon its produc¬
tion, which should, as much as possible, prevent any fraudulent issue.
This system was prepared and submitted November 7th 1862. A copy
will be found in the Appendix to this report marked C. It was not
immediately acted upon, and the necessity for action being immediate,
his attention, as directed by him, was called to it in the following letter:

Treasury Department,

November 20, 1862.

The Secretary directed me to remind him, from time to time, of my
programme of details for checks upon the issue of Fractional Currency,
submitted to him on the 7th instant.

I think it very important that they should have the Secretary’s care¬
ful personal examination, not only that there should be absolute check
against fraud or loss, but that their being so, should be so patent to all
who may examine them that even those now opposing the engraving and
printing in the Treasury building will acknowledge that the Secretary
has not entrusted me with the issue without first carefully guarding every
point.

I have now scant time to prepare the necessary books and blanks
before they will be needed, and earnestly hope the Secretary will be able
to make opportunity for examining the details and suggesting improve¬
ments.

I have the honor to be, very respectfully,

S. M. CLARK,

Chief Clerk , in charqe.

Hon. S. P. Chase,

Secretary of the Treasury.

The system remained under advisement for some time, and eventually
was returned to me endorsed as follows, without date to the endorse¬
ment:

“ The within system of checks and balances is approved; the currency
to be called Fractional Currency instead of Revenue Currency.

S. P. CHASE.”

The title upon the design was therefore altered in accordance with this
order, and the issue has since been known as Fractional Currency, which
is evidently its most appropriate title.

The paper upon which the issues of the Government were printed was
a large item of expense, and I had frequently reported to the Secretary
the propriety and economy of manufacturing paper of a distinctive

character in the Department. A report upon this subject was made by
me on the 7th of July, 1862, and will be found in the Appendix marked
D. My suggestions failed to impress the Secretary favorably, as to its
manufacture in the Department; but as I had reported to him that he
was paying the New York Bank Note Companies $22 50 per thousand
sheets for a paper inferior to that which I could buy in open market for
$12, he directed an advertisement to be prepared, fnviting proposals from
paper manufacturers for furnishing the Department with paper. Mean¬
while he authorized me to make investigations and experiments in refer¬
ence to the manufacture of a distinctive paper in the building. I labored
at this as time and opportunity allowed, and received much aid and many
suggestions from different experts, to whom I communicated my views.
We attempted to produce a paper evenly tinted in the fibre with a bright
non-photographic tint, which would not interfere with the engraving, and
could not be removed from the paper without destroying the fabric, and
which would at a glance distinguish the Government issues from all other.
All our efforts failed to produce this desideratum. We could introduce
no suitable pigment which we could not chemically remove.

The advertisement inviting proposals for paper was prepared by me
under the direction of Mr. Chase, limiting the submission of proposals to
manufacturers of paper only. Notwithstanding this limitation, proposals
were received from the Bank Note Companies of New York, and they
submitted offers with samples of a well-known maker at $18 per thousand,
while the maker himself submitted like samples, at the same time, at
$12 50 per thousand.

These various offers and samples received were first submitted to a
clerk for report, and subsequently re-submitted to me for like purpose.
My report was made on the 28th July, 1862, and was as follows:

Treasury Department,

Bureau op Construction,

Washington, July 28, 1862.

Sir : In compliance with the verbal instructions of the Assistant Secre¬
tary, to re-examine the samples of note and bond paper, already reported
upon by Mr. Homans, I have the honor to report:

That I have carefully examined all the samples, and concur with Mr.
Homans, that the two samples, submitted, respectively, by Mr. Goodwin
and Mr. Hudson, are the best.

The difference between the two is slight—each has minor excellencies
over the other—but as a whole there is very little choice between them.
Both are good.

Their fitness for the purpose, however, will depend upon the kind of ink
to be used. If the so-called “green tint” is used, the sample of Mr.
Hudson is too transparent. If his sample should be selected, he should
be directed to make the paper more opaque, which he can readily do with¬
out affecting its other qualities, or its value, by taking out less of the
vegetable oil in the preparation of the pulp.

I find some of Mr. Hudson’s paper of a similar quality to these samples,
with the samples submitted by the Bank Note Company, but as the Bank
Note Company’s paper is $18, and the manufacturer’s price is $15, I
think that Mr. Homans has properly confined his report of the lest sam¬
ples to the one submitted by the manufacturer.

The price of both Hudson and Goodwin, with water-mark, is $15;
without water-mark, Mr. Goodwin offers at $12 50. Mr. Hudson makes
no price for his paper without water-mark, but it is a reasonable inference
that it would be less if the water-mark was omitted.

The weight of the paper selected is fourteen pounds. The Secretary
doubtless understands that manufacturers will furnish any weight ordered
of a given quality in other respects.

The use of the “green tint” has forced the Department into the use
of heavy paper to sustain it—first twenty-two pounds, and now eighteen
pounds. If a million of dollars in ones is to be transmitted, they will
weigh one thousand pounds more (less difference of weight in clippings,
which is fractional) if printed on eighteen-pound paper than on fourteen-
pound.

In my judgment, (which is confirmed by the experience of banks,) the
thinner the paper, within a given limit, of a good quality, the better it is
for all purposes. I have issued bills on paper (printed on one side only)
of eleven pounds, which was the most satisfactory issue of bills I ever
made.

The specimen of water-marks submitted are all inferior and badly
done. None are worthy of the Secretary’s consideration, and the extra
price charged therefor is excessive. I cannot recommend the adoption
of any of them, nor of any of the “ distinctive characteristics” submitted.
Wilcox No. 6 is the best water-mark; but that is too poor. Seymour &
' Co’s, is the best design, but there is no specimen of its execution. Two
parties submit specimens of silk threads. I am not prepared to recom¬
mend either, as I deem them very undesirable. The most ingenious of
the two is Mr. Haywood’s straight threads in colors.

This closes my report on the samples examined by Mr. Homans. But
since his report was rendered another bid has been received from Stuart
Gwynn, of Boston. The envelope of this bid was postmarked at Boston,
July 18, but as the bids were not opened until the 19th, the bidder could
not have had access to them, and it was therefore decided to examine his
proposal, and the seal was broken by the Assistant Secretary on the 25th
instant.

This bid contains samples of most extraordinary character and excel¬
lence. The maker divulges to the Department his process of manufac-

ture, which is different from anything I have heretofore known and
sound in principle.

The paper possesses wonderful strength, is not permanently injured by
soaking in hot or cold water, and the surface does not rough up by abra¬
sion > under the ordinary tests. It is too transparent for the “green
tint,” and from its nature cannot well he more opaque. But it is a ques¬
tion well worthy the Secretary’s consideration, whether there would not
be greater safety against counterfeiting by the use of this paper, (of
which he might control the product,) omitting the green tint, and thus
saving more than two-thirds the cost of printing.

The “green tint” proves itself to be no security. The St. Louis coun¬
terfeit §10 proves this, and the Treasurer’s clerk (Mr. Meline) tells me
that among the bills coming to him to be split prior to burning, he has
found some with the green tint entirely gone.

I have been unable to test these samples as to their fitness to “receive
and retain ink.” They are too small for that purpose. Theoretically,
however, they would seem better adapted for ink than the ordinary paper
and the manufacturer alleges it to be a better surface for this purpose
than bank note paper. It could be readily tested here if larger samples
were sent; and if the Secretary is favorably impressed, after reading the
bidder s letter and examining his samples, I recommend that a few sheets
be ordered for the purpose of testing its printing qualities. Mr. Neale
(in the library) is a practical printer, of large experience, and can test
the paper on our photographic press.

The samples of Nos. 1 and 2 were not in the envelope—so I have not
seen them. Of the remainder, I prefer No. 4, at §16, but should prefer
a lighter weight than the lightest one submitted, the samples of No 4
being, respectively 14, 16, and 18 pounds. I think ten pounds heavy
and strong enough of the “vegetable membrane” paper, and I should
desire no better paper than this for the new issue of national designs
now preparing. I think it can be printed dry. Experiment can readily
settle that point. J

The “distinctive mark” submitted by Mr. Gwynn is ingenious, and
might be serviceable to the Department in detecting counterfeits ’ But
it would be of little value to the public at large; and for that reason
and also because it injures the paper, I do not recommend its use. ’

I commend Mr. Gwynn’s sample to the Secretary’s careful considera¬
tion, and have the honor to be, very respectfully, your obedient servant

S. M. CLARK,

TT c T , ^ Acting Engineer in charge.

Hon. S. P. Chase, j

Secretary of the Treasury.

No action was taken on this report, or on the report of Mr. Homans.
The report was promptly delivered by me to the Assistant Secretary,'
but was not, as will appear hereafter, read by the Hon. Secretary himself,’

and the Department continued to be supplied with paper by the New York
Bank Note Companies at the old prices.

I continued my experiments for the production of a distinctive paper.
In this pursuit it had occurred to me that if the paper could be printed
dry, so as to avoid the alternate expanding and shrinking consequent
upon the ordinary method of wetting the paper preparatory to printing,
it would not only add a distinctive feature to the Government issues, but
would enable me to separate the notes from the sheets after printing, by
machinery, and thus make them more convenient for public use than if
issued in sheets, and at the same time lessen the cost of production. From
the different shrinkage of different sheets, by alternate wetting and drying
at each of the different printings, it was found impossible to separate such
small notes as the Fractional Cnrrency, mechanically, when printed wet;
and the great labor, cost, and delay which would result in separating
them by hand labor had compelled the Department to issue them to the
public in sheets. This resulted in the notes becoming much mutilated
from the very irregular manner in which they were separated by those
who thus received them.

The attempt to print engraved plates on dry paper, was, in itself, no
novelty. It had been a desideratum since the first production of plate¬
printing ; and much time, thought, and labor, with large sums of money,
had been expended in attempting it, by different persons, both in this
country and in Europe, but without any practical success.

I communicated my views on this subject to your predecessor, who
heard them patiently, and attentively examined my theory, but he was
by no means sanguine that I could succeed in printing on dry paper
satisfactorily. In view, however, of the economy and safety that would
result if successful, he authorized me to make experiments for the pur¬
pose.

In an informal conversation had with Mr. Chase, at his residence, on
these and kindred matters, in October, 1862, I made allusion to my re¬
port upon paper last above quoted, and then found, to my surpris^ that
he not only had never seen the report which I had duly delivered to the
Assistant Secretary some months before, but he was not aware that any
report had been made by me upon the subject. He immediately directed
me to find the report and submit it. After some search it w r as discovered
and read to him, when he immediately telegraphed Dr. Gwynn to come to
Washington forthwith, and bring specimens of his paper with him. Up
to this time I had never seen Dr. Gwynn, and only knew of him from
letters of inquiry he had addressed to the Department in reference to the
4

advertisement inviting proposals for paper, and from his proposal subse¬
quently received.

Dr. Gwynn came to Washington upon this telegraphic call, and his
visit resulted in a contract for the production of the paper in the Treas¬
ury building, revocable at the Secretary’s pleasure on six days notice; a
condition that was inserted by myself, because I then had as yet only slight
and recent personal knowledge of Dr. Gwynn, and did not desire that the
Department should be irrevocably committed to the employment of any
person, for the manufacture of its paper, until he was favorably known by
his acts. A copy of the contract as drafted by me will be found in the
Appendix, marked E.

Dr. Gwynn took the necessary steps to procure requisite machinery,
which was made in different Northern markets.

I soon found that Dr. Gwynn possessed great scientific acquirements,
with large mechanical experience and ability, and freely communicated
to him my various plans for protecting the public and lessening the cost
of the Government issues. He received them with cordial favor, and en¬
tered with me upon their execution with patriotic zeal. On my part I
gladly availed myself of his proffered aid, for his scientific research and
mechanical resources were largely in advance of my own, and promised
satisfactory results.

His first attention was given to tinting the fibre of paper to be made
under his contract. He made extensive experiments, but, with all his
scientific knowledge failed to produce an even non-photographic tint which
that same scientific knowledge could not effectually remove. In the course
of his experiments he discovered a method of tinting non-photographically,
with a new and rare pigment, a fibre foreign to that used in the manu¬
facture of paper, but which could be introduced into and min gled with it in
such a manner that no re-agent known to chemistry, nor any method that
he could devise, would remove its non-photographic property without at
the same time removing the fibre itself. This was the origin of the so-called

spider-legs in the membrane paper, and which has been adopted as
one of the distinctive characteristics of the National Paper now made in
the Department.

Di . Gwynn at the same time earnestly devoted hims elf to the experi¬
ments of dry printing, and neglected all other pursuits to give me his aid
in this work.

The first membrane paper produced was unsatisfactory. The peculiar
process of making, rendered it more liable to split than ordinary bank note
papei. All bank note paper hitherto made would split more or less

readily, but this proved more liable to split than any other, and its use
in that form was therefore abandoned. But experiments were imme¬
diately made to overcome this difficulty, and ultimately with entire suc¬
cess. He now produces a paper under his contract which cannot be dis¬
solved in hot or cold water, which cannot be split, which has an irremov¬
able non-photographic tint in its spider-leg fibre, and which takes ink
more readily, retains it longer, and wears better than any paper hereto¬
fore manufactured for the purposes of currency in any country.

At the time this success in Dr. Gwynn’s manufacture of paper was
attained, our experiments in dry printing had reached a point where suc¬
cess seemed certain, when, in January, 1864, Dr. Gwynn was arrested
and confined in the Old Capitol prison, on the assertion of an employee of
one of the Departments now known by the name of Baker, that he could
and would produce charges against Gwynn to justify his arrest. After
being kept in confinement thirty days, without being allowed to face his
accusers or commune with his friends, or to know what charges were
made or to be made against him, Dr. Gwynn was unconditionally released,
and “allowed to go where he pleased.” He found on his release that no
charges had been made against him, and that none would be made. He
spent several months in seeking justification or redress, but failing to get
either, and becoming disgusted with his treatment and the delay in aton¬
ing for it, he has left the Department and engaged in other pursuits,
leaving the execution of his contract to a competent expert and attorney.

After Dr. Gwynn’s arrest I conducted the experiments in dry printing
alone, and although a successful result was declared impossible by ex¬
perts and professional men of great repute and experience, I had the
satisfaction to continue them to a perfect success.

Your predecessor, though frequently and earnestly warned by many
Treasury officers and other interested parties that the attempt to print
dry would be a failure, steadily encouraged me to persevere, although he
could not avoid much apprehension as to the result.

Before Mr. Chase relinquished the charge of the Department, he had
an opportunity to see the dry printing presses, with all their adjuncts, as
stated by him in a letter to a Committee of Congress, dated June 3,1864,
“ operating simultaneously, and in daily use, producing dry printed im¬
pressions, of unexcelled perfection and beauty.”

While the matters above narrated were occurring, the growth of the
Division continued. In April, 1863, a new issue of bonds became ne-

cessary, and I suggested to the Secretary the economy of printing them
in the Treasury. The necessities of the public service would not allow
sufficient time to prepare the plates at the Department, but I proposed
to print them from plates prepared in New York. These suggestions
were made of record on the 18th of April, 1863, as follows:

Treasury Department,

Bureau of Construction,
April 18, 1863.

Sir: In reply to the oral enquiry of the Assistant Secretary—“if the
bonds for a new loan can be prepared in this Department within six
weeks”—I have the honor to submit the following report and suggestions.

The entire work cannot be done in the Department in the time
specified.

In order to insure the desired speed, with more economy and safety
than attends the present issue, as well as to give the bonds a distinctive
Treasury characteristic, I respectfully suggest:

First. That one or more of the Bank Note Companies, and Mr. Bald¬
win, be employed to produce the plates for the faces of the bonds for
printing in the Treasury building.

Second. That Mr. Westbrook be employed to produce the plates on
his new plan (of an imprint from the grain of wood) for the backs of
the bonds, for a like purpose.

(I may say in this connection that I consider Mr. Westbrook’s inven¬
tion greater security for bond backs than geometric lathe work, but use¬
less for a currency , or any note intended for universal circulation. The
reasons for this opinion I will give in detail whenever the Secretary
desires them.)

Third, lhat the plates so prepared be printed in the Treasury, on the
(now idle) presses. This can be done at the rate of about ten thousand
sheets per day, without interfering with Fractional Currency. If the
bonds average one thousand dollars each, this would be about ten mil¬
lions per day.

Fourth,. That a surface print in gold or bronze of some characteristic
and appropriate design, which can be prepared by Treasury engravers,
be printed on the bonds as a distinctive Treasury mark. ” °

Fifth. That the bonds be printed on paper now in the Treasury. Dr.
Gwynn has on hand about 250,000 sheets of paper not yet converted into
membrane, which he does not offer under his contract, because he has
improvements invented since its preparation, which he desires to use on
the currency. It is, however, distinctive in its character—differs from
all other papers—has the non-photographic property, and is well adapted
lor bonds. It is a mooted question whether it is not sufficiently protec¬
tive and distinctive, to render the printing of the backs unnecessary. If.
so, the daily product can be doubled and the cost largely lessened. I en-

close some of this paper on which currency proofs were taken for the
Secretary’s inspection.

These suggestions are respectfully submitted for consideration.

I have the honor to be, very respectfully,

S. M. CLARK.

Hon. S. P. Chase,

Secretary of the Treasury.

Two of the companies, viz: the American and National Bank Note
Companies of New York, declined to furnish engraved stock, (which
includes bed-pieces or dies, rolls, original cuttings of lathe-work, &c.,)
and the plates made therefrom, unless they were allowed to print
from them all the impressions that should be needed. In view of the
excessive prices demanded by them for the printing, Secretary Chase
declined to fetter his contract for stock and plates with any agreement
for printing at the rates then demanded, and upon their decision not to
furnish plates on any other condition than that they should print from
them, he addressed the following letter to Mr. Hatch, president of the
American Bank Note Company:

Treasury Department,

May 23, 1863.

Sir: Your note of the 22d is just received. The letter of your pre¬
decessor, dated March 25, was in reply to mine of January 81 to Mr.
Cisco. In my letter I had expressed the understanding that the dies,
plates, &c., from which the United States Notes were printed belonged
to the Government, and their custody subject to the directions of the De¬
partment. The reply of your predecessor controverted this position;
and as I found that the understanding of the company differed so widely
from that of fhe Department, I did not think it just to insist on the
latter in disregard of the former. The printing, therefore, continued as
before. I did, however, express both to your predecessor, and to other
gentlemen connected with your company, my entire conviction of the
correctness of my views, and my purpose not to concede in future, as a
right, what I yielded temporarily to the contrary conviction of the com¬
pany. When, therefore, I proposed for designs for the new National
Currency I had no thought that the question as to the ownership and
custody of the dies would be renewed. It seems, however, that I was
mistaken.

In your letter you expressed your intention to concede the ownership
of the dies to the Government, and their custody to the exclusive direc¬
tion of the Comptroller, but only conditionally; and even this you do
upon the ground that you are bound to presume that in making the re¬
quirement I desire to subserve some good purpose, which I do not deem
it proper to disclose, and that I am willing to take upon myself the whole
responsibility of the dangers apprehended by you. Your intimation that

I have any purpose which I do not deem it proper to disclose is equally
unwarranted and offensive; but it is, on the other hand, quite true that
I am entirely willing to take the whole responsibility of whatever I
think necessary to the most safe and efficient conduct of the public affairs
nnder my direction.

The condition on which you make your concessions of the ownership
and custody of the dies to depend is inadmissible. I can make no stip¬
ulations as to the printing to be executed from the dies, bed-plates, rolls
or transferred plates, which I propose to have prepared for the Govern¬
ment. I shall, however, aim to do justly and liberally with whatever
company or individuals may execute the whole or part of that printing

Sincerely regretting that your determination makes it impossible for
the Department to avail itself of the ability, talent, skill, and means
controlled by your company,

I remain, yours, very respectfully,

S. P. CHASE,
Secretary of the Treasury.
Geo. W. Hatch, Esq., y

President American Bank Note Company.

At the same date the following letter of like purport was addressed to
Mr. Shepard, President of the National Bank Note Company.

Treasury Department,

May 23, 1864.

Sir : Your note is just received. I do not desire to create the slightest
embarassment for you. If, therefore, your desire to consult one or more
of your trustees in relation to the subject-matter of my letter of the 20th
instant makes a delay of your answer until Monday convenient to you, I
shall not object to it.

I regret that you find the main features of the matter to be considered
so radically different “from what had been expected.” I supposed
that the tenor of our repeated conversation had left no doubt upon your
mind as to the purpose of this Department to insist on the ownership and
on the direction of the custody of the dies and plates used in printing
notes and bonds. You are aware that I regarded such ownership and
custody as the right of the Department, under its former contracts for
printing with the two Companies. As this view was not conceded, I did
not insist on the right, but continued the printing as before. In a new
contract you could hardly expect that I would leave this question open
to controversy. .

My purpose now is to obtain dies and plates suitable for printing the
a lonai Currency, and having obtained them, to employ in printing
lem those parties who will do the work in the best and most prompt
manner for a fair and just compensation. I design to come under no
stipulation which will at all embarrass the Department hereafter in such
ac ion as the public interests may really require; while, at the same

time, I propose to deal justly and liberally with all who render service
to the Government.

I send you this note in order that you may labor under no misconcep¬
tion whatever. I desire no proposals for dies or notes coupled with any
other condition than that of payment for them when they are prepared.

Yours respectfully,

S. P. CHASE.

Secretary of the Treasury.

Shepard, Esq.,

President pro tem. of National Bank Note Company.

The only parties in Hew York, therefore, whom Mr. Chase could contract
with for the engraved stock and plates, were the Continental Bank Note
Company—a new concern with inferior facilities, and a Mr. Baldwin, who
also desired to engrave work for the Government. An agreement was
therefore made with the Continental Company for the engraved stock and
plates of two of the four denominations of bonds to be issued, and with Mr.
Baldwin for the other two. Very great delay occurred in the delivery
of the plates by both these parties, but they were finally delivered, and
printed in the Department, with the exception of the denomination of one
hundreds, which were printed in New York. The sum saved to the
Treasury by the mere printing of this one series of Bonds in the De¬
partment was, as appears by the record, $37,906 50.

Subsequently similar arrangements were made for engraved stock and
plates in New York, and printing in the Treasury building, other issues.
The stock, with one set of plates was thus procured for one and two years
five per cent, nptes, the additional plates necessary made in the Depart¬
ment, and all printed in this Division.

The leading companies having withdrawn their refusal to execute en¬
graved work for the Treasury without doing the printing, were employed
to make the engraved stock and one set of plates for the above named
issues.

The plates for the fourth series of 5-20 Coupon Bonds; for all the
10-40 Bonds, both coupon and registered; for the 5-20’s of the seventy-
five million loan, and for those of the forty million loan, both coupon and
registered; for the new issue of 7-30 notes; and for a portion of the
bonds required for the conversion of the first issue of 7-30’s; for the com¬
pound interest notes; and for the fractional currency; were all prepared
and printed in the Department, as well as the plates for the certificates of
indebtedness, for the Treasury drafts, and for various other work required
by current business.

The engraved stock purchased from the Bank Note Companies, added
to that produced in the Department, together with that which its staff of
artists was capable of producing, rendered the Department entirely inde¬
pendent of these monopolists. The change from a condition of complete
dependence upon them to a condition of complete independence, with a
large saving of cost and great increase of convenience, was no inconsid¬
erable result, and involved great and anxious labor.

In detailing the growth of the Division, it is proper to record that this
growth has been retarded, to some extent, by the non-fulfilment of meas¬
ures which were originally inaugurated for promoting its efficiency, use¬
fulness, and economy. When the contracts with the New York Bank
Note Companies, for the engraved stock and one set of plates for the
currency of the National Banks, were contemplated, it was with the inten¬
tion of making in this Department, if it should be found necessary or
desirable, by the process of transferring from the engraved stock so
acquired, the very large number of plates that would be necessary for
the Banks then organized and those about to be organized, and also for
printing more or less of their issues in the Treasury building. The
great saving of cost that would be thus effected from the rates first
demanded by the Bank Note Companies—more than half a million of
dollars on the mere transferring of the plates alone—as well as the greater
security that would be attained by printing at the Department, induced
your predecessor to favor the plan of doing this work in the Treasury.

After the appointment of the Comptroller of the Currency this plan
was changed. This officer has steadily opposed transferring and print¬
ing of the National Currency in the Treasury, deeming it less safe for the
Department, (as appears by his testimony before a committee of Congress,)
to employ its own agents, under its immediate control, than it was to
employ the New York Bank Note Companies, upon whom there was no
Treasury check whatever, either for paper, printing, or issue. The
economy that would be effected was ignored.

This opinion appears to me the more incorrect in view of the fact
that all the issues of the National Banks ultimately pass through this
Division. Every dollar of the National Currency thus far delivered to
the National Banks by the Comptroller, was numbered, trimmed, and sealed
in this Division. When it is received from the New York Bank Note
Companies, it is delivered to me to be finished, and then returned by me
to the Comptroller before it is transmitted to the Banks. So that, in point
of fact, the risk of handling the sheets in New Y ork is added to the risk
of handling them in this Division. The bonds, also, which are first printed

in this Division and delivered to the Register, and subsequently purchased
by the National Banks for deposit with the Treasurer of the United
States and with the Comptroller of the Currency, as security for Govern¬
ment deposits, or as security for the circulating notes, come back
again to the Division for printing their endorsements, thus making them
twice handled by its operatives. This also goes to show, in my judgment,
the unsoundness of the Comptroller’s opinion, as the notes he has
issued, and bonds received by him, have passed through my hands
without, to this date, the loss of a single dollar in this Division.

The presses and machinery prepared for transferring and printing the
currency of the National Banks have thus remained idle, and their cost
has added to the expense of organizing this Division, without as yet any
corresponding benefit.

In view of the possible transferring and printing of the plates in the
Treasury, your predecessor had decided not to allow the original dies to
be hardened in New York before they were delivered to the Department.
To appreciate the necessity for this action, it must be observed that du¬
plicates of the work cannot be made, by the transfer process, until after
the original dies or bed-pieces are hardened. When they are hardened
duplicates can be made from them with a transfer press in a few moments.
Secretary Chase was of the opinion that they should not be hardened before
they came to the Treasury, because, if hardened before delivery there
would be a division of responsibility as to their fraudulent reproduction;
and if any duplicates should surreptitiously get into use, they would afford
no means of determining whether they were duplicated in New York or
in the Treasury.

He therefore wrote to the Continental Bank Note Company, who were
then preparing the dies for the $5 and $10 National Currency notes under
their contract, specifically directing them not to harden the dies for the
work, until after the proofs had been sent to the Treasury and approved.
Notwithstanding this direction the Continental Company hardened the
dies before sending the proofs, and thereupon Mr. Chase sent the Presi¬
dent of the company the following letter :

Treasury Department,

• September 25, 1863.

Sir : I am in receipt, through Mr. W. D. Wilson and Mr. Ormsby, of
the proofs of the five-dollar and ten-dollar National Currency notes en¬
graved by your company, which will have my careful examination.

I am surprised to find that all the dies of the obverse have been hard¬
ened, as proven by the transfers now exhibited to me. On the 10th, and

again on the 11th inst., I wrote you distinctly directing that none of the
work should he hardened until the proofs were approved, and I under¬
stood that you would not harden them.

I am aware that the dies can he softened, and alterations made, and be
again hardened for use; but your action in hardening them has rendered
nugatory my action to avoid any division of responsibility, as suggested
in my letter of the 11th instant, and assented to in yours of the 12th
instant, by the appointment of an agent of this Department to take charge
of them when they were hardened. As they have been out of the
Department’s custody since they were hardened, of course no complete
responsibility can be assumed by either party.

I much regret your action, and desire an explanation.

Very respectfully,

S. P. CHASE,
Secretary of the Treasury.

Alex. C. Wilson, Esq.,

President Continental Bank Note Co., New York.

Subsequently it was ascertained that the American Bank Note Com¬
pany were preparing, without any authority or contract therefor, the
work for the $5 and $10 notes from the same designs and for the same
issue, as were being prepared by the Continental Company under con¬
tract. Mr. Chase did not stop their work, because, as he advised them
on the 14th November, 1863, “ he was unwilling to institute proceedings
against them, and because, also, he thought it not impossible that con¬
tingencies might arise in which the Government would find it useful to
avail itself of their work.” But a contract was made with them for the
engraved stock and one set of plates for the denominations of 20’s, 50’s,
and 100’s of the same issue of National Currency Notes.

Mr. Chase then directed me to submit to the Comptroller, in writing,
my views as to the proper course to be pursued under the existing cir¬
cumstances. Under this instruction I submitted the .following letter,
which was personally referred by the Comptroller to the Secretary:

National Currency Bureau,

First Division,
October 30, 1863.

Sir : After the most earnest reflection I am able to give the matter, I
am prepared to recommend the following course for you to adopt in
regard to the National Currency:

First. 1 would divide the denominations of the 5’s and 10’s, giving the
5’s to the Continental, and the 10’s to the American. If they will make
transfers at a fair price, I would order plates from each for all the banks
organized, and a sufficient number more with blanks for titles, for prob¬
able future use, and then direct all dies and original work, with all rolls

and transfers, other than plates for printing, to be transmitted to you,
to be by you sealed up and retained, and not mixed with the Depart¬
ment’s Government stock. No plates of these denominations to be trans¬
ferred at the Department.

This would divide the risk of reproduction between the two companies,
and any surreptitious copies put in circulation could be distinctly charged
to one or the other.

The best security we will then possess will be in a distinctive paper.

If the issue of a single bank is made on common bank note paper, this
security will be also lost.

I would, therefore, print all the issues dry, on membrane paper, as now
prepared, which is more difficult to split than ordinary bank note paper,
and cannot be obtained elsewhere than in the Treasury; and, in the
present state of art, such printing can no where else be done.

Thus the responsibility of all transfers will be on the companies, and
the responsibility of all printing on the Government. All security now
attainable will thus be reached for the 5’s and 10’s.

Second. For the 20’s, 50’s, and 100’s, I would insist that the entire
work should be transmitted to you before hardening; not a single piece
to be hardened. These denominations I would transfer and print in the
Treasury. ‘

If this course had been insisted upon with the 5’s and 10’s, there would
now be no division of responsibility. It is mortifying that the companies’
non-compliance with the Secretary’s order should inure, as they expected
it would, to their pecuniary gain and Government loss; but all regrets
for such results must now be merged in what is most for the safety of the
banks and the people.

If the above-suggested course be thought unwise, and it is decided that
it is best to transfer some of the fives and tens in the Treasury, I will not
shrink from the personal risk of reputation involved to myself.

If my lifetime character cannot maintain itself against the companies’
machinations, it is not worth preserving. But I cannot lose sight of the
fact that if they make the public believe anything discreditable to myself,
it will react to the Secretary’s injury for employing me under existing
circumstances. I therefore much prefer the course herein suggested,
which to me, after serious canvassing all the points, seems the most judi¬
cious, and the most likely to result satisfactorily to the Department and
to the people, and the most speedy way, consistent with security, to get
the notes into circulation.

Please understand that I will not hesitate to assume any responsibility,
however grave, which I am desired to, where I can control the details. I
only hesitate in this because the result may' be unfortunate from causes
out of my control, and in the control of those who would gladly do me
and the Department an injury.

In this connection I respectfully call your attention to the fact that the
National Company have not responded to the Secretary’s invitation to
submit proposals for engraving the 500’s and 1,000’s; and also to the
fact that the American Company refuse to sell the dies for the seals to

the Department at any price, but offer to furnish duplicates at $10 each.
These duplicates do not cost fifty cents each.

Very respectfully,

S. M. CLARK.

lion. Hugh McCulloch,

Comptroller of the Currency.

This paper was carefully read and examined by Mr. Chase, in the
presence of the Comptroller and myself, and by him emphatically adopted
in whole and in every part. He thereupon, with the Comptroller’s assent,
directed my recommendations to be carried into effect. Under the oral
instructions of Mr. Chase, I then prepared a letter for the Comptroller’s
signature, directing the American Company not to harden the dies for
the 20’s, 50’s, and 100’s. This letter was duly signed by him and mailed.
Some time after its date I received information that the American Com¬
pany intended to disregard the Comptroller’s order, in the same manner
as the Continental Company had disregarded the Secretary’s order of like
tenor and effect, and that the Comptroller tacitly assented to their course.

I therefore addressed the following letter to the Secretary of the
Treasury at its date:

Treasury Department,

December 3, 1863.

Sir : I have the honor to call the Secretary’s attention to the matter
of hardening the dies of the twenties, fifties, and hundreds of the National
Currency.

I am led to believe that it is not the intention of the Bank Note Com¬
panies to comply with the instructions of the Comptroller in the matter;
and since these instructions were issued, I think the Comptroller has, in
his own mind, decided not to transfer the plates, or print them, in the
Treasury.

I do not ask any action from the Secretary which would prevent the
Bank Note Companies from doing the printing, but I do most earnestly
desire that he should retain the option of causing the work to be done
either by the Companies or in the Treasury, as he may himself think
best.

The action of the Companies on the fives and tens, in hardening the
dies against orders, resulted, as the Secretary is aware, in making a divi¬
sion of responsibility unavoidable, unless the Companies completed the
work. I seek to avoid such a result in the other denominations, and have
prepared a letter to the Company, which accompanies this, for which 1
ask the Secretary’s signature if my views meet his approval.

Transfer presses have been built and placed in the Treasury to do the
transferring, and printing presses to do the printing, and men hired for
the work.

I think the Secretary would justly censure me if I failed to call his at¬
tention to this matter, and by such omission should leave the Department
open to the charge of incurring the expense for the work, and then de¬
priving itself, in advance , of the power to do it with safety.

I have the honor to be, very respectfully,

Your obedient servant,

S. M. CLARK.

lion. S. P. Chase,

Secretary of the Treasury.

The letter alluded to and enclosed in the above was as follows:

Treasury Department,

December 3, 1863.

Sir: You were instructed, on the 6th ultimo, by the Comptroller of the
Currency, not to harden the bed-pieces for the $20’s, $50, and $100’s of
the National Currency before transmitting them to the Department.

You will please follow this instruction literally, and not harden any of
the work.

I am aware that your contract requires you to furnish one set of plates
of each denomination, and that you cannot furnish them without the hard¬
ening of the dies. '

It may be that I shall not require of you the fulfilment of this part of
your contract; and while I am not prepared to say that I shall not require
it, it is proper to advise you that if I should not, I think it equitable to
make you a fair compensation for any loss of profit on the omitted work
which such a decision might involve. I wish every portion of the work
to be first transmitted to the Department in its original condition without
hardening or transfer, and you will then be advised of what further action
I may desire in reference to it.

Yours respectfully,

S. P. CHASE,
Secretary of the Treasury.

Geo. W. Hatch, Esq.,

President American Bank Note Company.

This letter was immediately signed by the Secretary and transmitted
to the company by mail.

Notwithstanding all this the company hardened the dies as soon as
completed, for which they had the authority of the Comptroller, by his
letter of the 6th February, 1864, which is published at page 302 of the
report of the Special Committee of the last session of Congress.

Thus were all the carefully matured efforts to protect the Government,
and to get the work done economically, and without a further division of
responsibility, frustrated, and the entire work of transferring and print¬
ing the currency for the National Banks of the denomination of five

dollars and upwards given to the New York Bank Note Companies at
a very great advance on the Treasury cost.

The difference of opinion between the Comptroller and myself on these
and other matters has led to many oral discussions between us, and
some correspondence, the general tenor of which may be inferred from
the following letters:

National Currency Bureau,

First Division,
November 23, 1868.

Sir : In accordance with your orders, I send this day, by express, the
first parcel of bank note paper, being 2,000 impressions with titles bronzed
on an irremovable mordant, for the National Currency.

The Bank Note Companies have told you that they can print these
notes with an accurate register, according to my plan.

I have told you that they cannot, and I now desire to place that opinion
upon the record to abide the result, for I sincerely believe you will be dis¬
appointed.

I will also place my reasons upon the record which I have so often
repeated to you.

The titles are bronzed on the sheet in exactly the position on the paper
required by the proof you have given me, to appear in the proper places
on the notes.

When the companies receive this paper, they will first wet it prepara¬
tory to printing one color on the back.

The sheets will expand irregularly in the wetting. It will then be
printed and dried. It will shrink irregularly in the drying. This opera¬
tion will be repeated with like results for the second printing of the back.
It will then be wet for the third time for the faces. Under the alternate
expanding and shrinking of the paper, the bronzed letters will now be in
different relative positions from the original ones, and consequently will
not appear in the same places on all the different notes—one note out of
each four can be registered properly. The others cannot, except upon such
sheets, if any, as happen to have been unchanged by the above process.
The same will be true as to an accurate register of backs and fronts.

If you find the result to be as I predict, you will then appreciate the
force of my remark, that if I have devised a method for preventing suc¬
cessful imitation, which baffles all the skill, resources, and facilities of
these powerful companies, the issue thus prepared would be far beyond
the reach of ordinary counterfeiters.

Personally, I have no desire to do this work; it would largely increase
my care, my labor, and my responsibility, without in any way increasing
my income.

It is only a sincere conviction that it would be an economy to the
Government, and a safety to the people, that has induced me to urge that
the work should be done in the Treasury.

My views are unchanged since my letter of the 30th October, to which
you are respectfully referred.

Very respectfully,

S. M. CLARK.

Hugh McCulloch, Esq.,

Comptroller of the Currency.

To this letter the Comptroller replied as follows:

Treasury Department,

Office of Comptroller of the Currency,

Washington , November 24, 1863.

Dear Sir: Your favor of the 23d instant is received, and in reply I
have to say that it contains the first intimation I have had from you, or
anybody else, that there would be any difficulty in the accurate and
uniform printing of the National Currency by reason of the title being
bronzed upon the sheets before they were forwarded to the Bank Note
Companies. If I had been advised that, in your opinion, these compa¬
nies could not accurately print the notes over the bronzed title so that
the bronzed letters should be upon each note in the same place, I should
have hesitated before adopting this supposed protection against pho¬
tography. It will be a matter of deep regret if the preparation of the
notes for the National Banks shall be delayed by reason of your not
communicating your opinion to me on this point before the decision in
favor of the use of the mordant had been made.

The difficulty of making an accurate register of backs and fronts, in
the ordinary way of printing, you have frequently alluded to, but until
your ability to print with the hydrostatic presses with sufficient rapidity
to meet the wants of the National Banks had been tested, it is very
questionable whether the plates should have been so prepared (as they
were prepared under your advice) as to prevent the Bank Note Com¬
panies from giving as satisfactory impressions from them as you predict
will be the case. In regard to the paper manufactured by Dr. Gwynn
I need only remark that when I first came to Washington I was assured
by you that the Fractional Currency would be printed upon it, and be for
a sufficient time in circulation for a proper trial of its merits, before we
shall be ready to commence the printing of the National Currency. In
your letter to me under date of the 30th ultimo, you say, I would there¬
fore print all the issues dry, on membrane paper as now prepared, &c.,
and yet, on the 9th of November, when I put the question to you,
would you advise the printing of the National Currency on any paper
yet manufactured by Dr. Gwynn, or in use for the Fractional Currency,
I understood you to say that you would not, but that you expected that
such paper would be prepared, and specimens would be ready for exam¬
ination within five days from that time. Whether or not, after a year or
more had been expended in, up to that time, unsatisfactory experiments
in the manufacture of a peculiar and desirable paper, it was advisable to
wait for still further experiments, and to commence the printing of the

National Currency on paper, the merits of which had not been subjected
to the practical test of wear, I am perfectly willing to leave for the deci¬
sion of your own unprejudiced judgment. As you have evidently ad¬
dressed your letters of the 30th ultimo and 23d instant to me for the
purpose of placing your position upon record, I have thought proper to
address you this letter in order that my own may not he misunderstood.

Very respectfully, yours,

h. McCulloch.

S. M. Clark, Esq.,

Chief First Divison National Currency Bureau.

Comptroller.

To this letter I at once made the following reply:

National Currency Bureau,

First Division,

November 25, 1863.

Sir : I am in receipt of your letter of the 24th instant, in reply to
mine of the 23d.

It was not my object to provoke a discussion by that letter, nor do I
now propose to do so; but I cannot, in justice to myself, omit to reply to
your letter.

As you allege that I had not before told you that wet printing would
not bring the bronze lettering always in the same place upon the note, I
must believe it is so, though I have said it so often, I can hardly see how
I omitted to say it to you. But it was in reality unnecessary to say it to
you, as you admit that I told you that one printing (the backs) would not
register with another (the fronts.)

It is so obvious that the same result would attend any other two print¬
ings, that your usual good judgment could not fail to see that it applied
with equal force in both cases. No expert knowledge was necessary. If
true in one case, it was necessarily true in the other.

lour remark that your adoption of this supposed protection against
photography, &c., is not just in its terms. This protection was the result
of much thought, labor, and experiment. It has to this hour defied all the
attempts ot the scientific commission to successfully remove it, although
they had the advantage of being informed of what materials it was com¬
posed. It is true that Mr. Lea has frequently asserted that he could re¬
move it, and you have advised me that he has done so; but I have never
seen a piece of paper from which it has been removed, without also remov¬
ing the engraving. Having invented it, and given it gratuitously for the
use ot the Treasury, I was not at first willing, as you will remember, that
it should be used gratuitously by the Bank Note Companies; but I yielded
this point cheerfully, on your own earnest suggestion, that the invention,
though used by the Companies, was used for the Government. This
being so, it seems hard that you now intimate that the usefulness of the
invention is only a matter of supposition.

To your next allegation, that it was “questionable whether I had the
the right to devise a form which the Bank Note Companies could not

print,” my reply is, that it was not only my right, but my duty, to devise
safeguards against counterfeiting. It is no part of my duty to limit those
devices by what the Bank Note Companies might be able to do. If it
shall prove that my method is beyond their successful imitation, I respect¬
fully submit that it will prove a very great safeguard against ordinary
counterfeiters.

To your third allegation, of contradictory statements on my part in re¬
lation to membrane paper, I reply that you have, doubtless unintention¬
ally, confused what I have said about quality with what I have said about
size.

My advice of the 30th October, “ that I would print on membrane as
now prepared,” in no way conflicts with my reply to your enquiry of the
9th November, if I was “ready to print the National Currency on paper
that I could recommend.” You must have forgotten, or else strangely
mistaken my reply, for I told you then that I had none prepared for your
size. The size I was then using was prepared for Fractional Currency
size; that prepared for your size was of an earlier make, which I did not
recommend. I have not, even at this day, any prepared of your size of
the kind I recommend. I shall not prepare any until you order it.
When you order it, it can be speedily prepared. I prepared the first
without orders, for my inference, from our conversation, was, that you
intended to use it. When I found to my regret, that you did not design
to use membrane paper, I of course decided not to prepare any for your
use, (which would be useless for Fractional Currency,) unless you should
thereafter direct me to do so.

But I will not prolong my reply. I am pained by the tone and spirit
of your letter more than by its words. I had hoped to meet your cordial
and approving co-operation in my plans to protect the public and the
Government. I perceive to my great regret, that my plans are, to a con¬
siderable extent, overruled by your decisions, and that the careful study
and experience of the past two years is thus, in my judgment, to that ex¬
tent frustrated.

Your decision being made, you need no assurance from me of my
earnest co-operation in carrying out your views, as is my duty, to the
whole extent of my ability, on such portions of your work as may come into
my hands. All I wish is, that it may be of record, that the work is to
done in accordance with your judgment, and not in conformity with mine.

I trust this letter will not be deemed in any sense disrespectful.
Nothing is farther from my mind than even a show of disrespect. I am
sorry that my plans are not to be carried out; yet, if they are not in accord¬
ance wflth your judgment, you do right not to carry them out; but on
you, not on me, must rest the responsibility.

Very respectfully,

S. M. CLARK.

Hugh McCulloch, Esq.,

Comptroller of the Currency.

P. S .—November 27.—The above was written at its date, but was not
handed to you because, upon the morning that I designed to leave it at

your office, you received from the Bank Note Company a proof of their
work, verifying my prediction (recorded on the 23d instant) as to their in¬
ability to do the work accurately with wet printing.

Upon further reflection it has seemed to me best to hand it to you, in
order that it may be put on file.

To this letter no reply was made by the Comptroller.

The lapse of time, and more experience, have failed to convince me of
the wisdom of these alterations in the original plans ; nor can I yet per¬
ceive what advantage the Government can possibly derive from getting
the work upon its issues done out of its immediate control, by agents who
who are responsible only to a private corporation, upon whom there is no
Treasury check whatever, and who execute the trust at a distance from
the seat of Government, at a greatly enhanced cost, in addition to the
cost and risk of bringing the printed sheets to this city; while they retain
all the original dies and transferred plates in their own custody, instead
of their being deposited in Treasury vaults. When it is remembered that
the notes ultimately pass through this Division, the error of the Comp¬
troller’s opinion becomes, in my judgment, more apparent.

The difficulty of getting seasonably from the Public Printing Office
much of the currently needed letter-press printing, such as blank forms,
circulars, &c., induced your predecessor to direct me to establish a small
experimental printing office in connection with this Division. This was
accordingly done, a few small founts of type procured and one compositor
employed. The experiment proved satisfactory, and was soon found to
be a necessity from other causes. The number of forms required fo* sur¬
face-printing, as well as the printing of endorsements upon all the Bonds
and other securities which were deposited with the Comptroller and
Treasurer by the National Banks, rendered a printing office indispensable,
in some portion of the building, as the work on them is so urgently
.required a 3 to preclude the possibility of sending it elsewhere to he
printed, while the amount, sometimes nearly two millions of dollars per
day, would render their transmission to and from a distant office at the
Department’s risk very hazardous. The great convenience resulting from
the arrangement gradually led to the enlargement of these facilities, as
well as the addition of a ruling machine for ruling blanks, &c. Step by
step this business has increased, until a sufficient amount of. type and
presses have been accumulated for all Treasury letter-press printing, with
appliances for ruling all its forms and tables, as well as for ruling all the
blank paper required by the Department, at much less cost than formerly.

The large number of impressions of letter-press printing required by
the various loans made a necessity for stereotype plates and their frequent
renewal; while the great delay in getting them from any foundry within
reasonable distance, caused serious hindrance to the public business, and
created great dissatisfaction among those dealing with the Government.

This led to the addition of a stereotype foundry to this Division, which is
now in successful operation, producing in a few hours, plates of a superior
quality to those which the Department was before compelled to wait days
and even weeks to obtain. The cost of these plates has also been largely *
reduced from the prices formerly paid for the work, and the stereotype
foundry has proved to be a very important and useful adjunct to the
Division.

The same causes which led to the establishment of this foundry, also
led to the erection of suitable batteries for electrotyping, and all electro¬
type work required in the Department is now executed in this Division,
at a great saving of time and expense.

The celerity and economy of production of the mechanical work done
in this Department have become so apparent that both the State and
Post Office Departments have made application for work which was im¬
mediately required, which could be more rapidly executed here than at
the places from which they were accustomed to obtain it. Under your
authority, work has been done for these Departments, which is to be paid
for from the proper appropriations under their control.

The work done for other Departments has been of a character usually
obtained by them from some Northern city. For the State Department
there has been engraved a new exequatur plate, from wffiich its present
supply has been printed, and also a new plate for passports, which is nearly
ready for printing. A supply of passports was also printed from its old
plate. For the Post Office Department all the money orders so far issued
have been double numbered in this Division by the numbering jnachines. .

The labors of this Division have therefore largely increased beyond
what the mere issue of Government notes and securities would have re¬
quired, and far beyond what any one would have imagined at the outset,
but the convenience of the Department has thereby been materially pro¬
moted, with a large saving to its revenue; while it has enabled the
Treasury force to transact the enormous amount of business which the
war has engendered, more readily and promptly and satisfactorily than
could possibly have been done if this Division had not been called into
existence.

PRESENT CONDITION OP THE DIVISION.

The present condition of the Division is, therefore, one of independence
of extraneous aid for the work it has to perform. It now possesses within
itself the means of preparing and printing all Government issues, and all
printed work required in the operations of the Treasury. Nothing but
the raw materials and motive power are required to be furnished. It is
prepared to make and repair its own machinery, manufacture its own
paper and ink, engrave and print its own plates, and need not go outside
the Treasury walls for the execution of any of its present work which the
exigencies of the public service may require.

In view of these facilities, now in possession of this Division, it is, in
my judgment, matter of regret that it is not charged with the production
of the Currency issued by the National Banks; and it is still more to be
regretted that, by a recent decision of the Comptroller of the Currency,
which I learn only from the newspapers, the printing of the small notes,
authorized by an act of the present Congress to be provided for those
Banks, is likewise to be done outside of the Treasury and of its control.

I regret that these means and facilities are not better appreciated by
the Comptroller, because the question of printing practically results in
the simple issue of who shall hire the journeymen. The work would
probably be mostly done by the same men wherever printed; and in effect it
had only to be decided whether the Government should hire the men, or
whether the Companies should hire them, and charge their profit on such
hiring. It is well known both here and in New York, that the award of
this printing to the Companies will result in lessening the facilities of the
Division, as it will thereby be depleted of more or less of its journeymen,
who have awaited the announcement of this decision to determine whether
they would work in Washington or New York.

Under the instruction of your predecessor, a new Fractional Currency is
now in course of preparation to take the place of the present issue. T his
course seems unavoidable, to protect that portion of the public which will
not protect itself by the exercise of ordinary diligence in scrutinizing
paper money. The counterfeit issues, after they are artificially worn and
soiled, which the counterfeiters are very skilful in doing, become difficult
to distinguish from the genuine, except by some care in their examination;
and many of those who handle this currency, receive and pay it with
scarce any examination whatever. The only course, in my judgment,

when a counterfeit gets into the channels of circulation, is therefore, to
make a new issue, radically differing in size and style from the counter¬
feited issue, and withdraw the latter from circulation. This is what your
predecessor proposed to do. If the issue now preparing should be suc¬
cessfully counterfeited, a not impossible event—for it is a saddening fact
that much rare talent is thus dishonestly employed—another change will
be required, unless, by that time, specie payments should be resumed, and
the now hoarded small change of the country again come into active use.

It was designed to issue this new currency printed exclusively upon the
National paper, and to print it dry. In the present stage of art, this
paper can be procured no where else in the world except from the
Treasury, nor can it, at present, any where else be printed dry. It is
expected that these two distinctive features, will render the successful
counterfeiting of the new currency more difficult. It will certainly, so
far as the capacity of experts to detect it is concerned, for these differ¬
ences from ordinary paper and dry printing are unmistakable by any one
conversant with the work of engraving and printing. But it cannot be
denied that no measures yet devised, will protect those money takers who
will not give time, or exercise judgment, for its examination in receiving
and paying it.

The machinery for dry printing is now, and has been for some months,
in successful running order, producing daily a large number of impres¬
sions, much superior to any impressions by wet printing. Any number
of dry-printing presses can be operated simultaneously, without inter¬
ference with each other, by the peculiar and novel adjuncts devised
for the purpose. But ten of them are now in active use, and, although a
pressure of more than two hundred tons is exerted at each impression,
yet an impression can be taken in a few seconds. Experience proves that
impressions can be taken as fast as the plates can be inked and put in the
press, (the process of inking being the same as for wet printing,) and this is
the only limit to the rapidity of their execution; while every impression is
not only perfect in itself, but each is likewise an exact counterpart of the
original—a result impossible by any wet printing. During the last two
months not a single imperfect impression has been produced on any one
of the dry presses now in use; while by the wet presses, the production
of imperfect impressions is daily reckoned by hundreds. The work
of both wet and dry printing is done by journeymen for what are techni¬
cally termed “piece prices”—that is, a given price per thousand sheets
for the number of impressions printed. The piece prices paid for dry
printing are nearly twenty per cent less than for wet printing; and when

the operatives become expert, it is expected that the entire cost, including
wages of valve-tenders and feeders, will be less than the cost of wet printing.

This official announcement of these results, attained under, ceaseless
opposition, is, to me, peculiarly gratifying.

The machinery now in use in the Division is thus enumerated:

Ten steam engines, from four to thirty horse-power each.

Seven engine lathes.

Two planing machines.

One upright drill.

One circular sharpener.

Two parallel sharpeners, and other machinist’s tools.

Fifteen transfer presses.

Seventy-two hydraulic presses.

Four hydraulic receivers.

Twenty-five hydraulic pumps.

Ninety-six roller presses.

Five paper presses.

Six Hoe & Co.’s cylinder presses.

One Washington press.

One ready proof press.

Two paper engines.

Six ink mills.

One stereotype press.

One stereotype planer, with other tool^s for stereotyping.

Three batteries for electrotyping.

One guillotine paper cutter.

One upright paper cutter.

Twenty-two numbering machines.

Nine trimming machines.

Seven separating machines.

Fourteen sealing presses.

Four double acting separators for Fractional Currency.

Two pentographs.

One ruling machine for paper.

One ruling machine for metal.

Making a total of three hundred and twenty-four engines, machines, &c.
There are now employed in the Division, in connection with this
machinery, 237 male and 288 female operatives ; but the number varies,
more or less, from time to time, as the exigencies of the public service
require.

DIFFICULTIES ENCOUNTEKED.

Some of the difficulties which have been encountered in creating this
Division have already been alluded to in this report, in detailing its
origin and growth. The opposition to its successful establishment was
steady and persistent, and since it has been successfully established like
opposition to its progress has continued to be apparent in various forms.
From the beginning of the work until the present time it has manifested
itself through many different channels, both from within and without the
Department. Most of that from without the Department has, not im¬
probably, been supposed to originate with the New York Bank Note
Companies, though not at all times traceable to them. It is not charita¬
ble to suppose, although it has been so asserted, that the opposition man¬
ifested by those within the Department had the same origin.

It was natural that the Bank Note Companies should oppose the
organization of this Division. The very large amount saved to the Treas¬
ury by its operations lessened so much the gains of these Companies.
This was particularly true of the older Companies, the American and
National. The Continental Bank Note Company, a new concern, was
put in operation in New York, with resources and facilities greatly
inferior to those of the other two Companies, for the special if not the
sole purpose of doing the Government work which had been, up to
the time of this Company’s formation, monopolized by its older rivals.
It had, therefore, no present gajps to lessen. Its profits were prospec¬
tive. The complete organization of this Division being likely to render
the employment of the Continental Company neither necessary nor de¬
sirable, intensified their opposition, and its officers were more bitter and
vindictive, or at least more undisguisedly exhibited their vindictive bitter¬
ness than the officers of the American or National Companies.

The first openly acknowledged attempt to oppose your predecessor’s
policy of producing the Government issues in the Treasury came from
the President of the Continental Bank Note Company, in the shape of
written charges, with specifications, signed by himself, and addressed to
the Secretary of the Treasury, against my personal character. It was
supposed by this President that if he could induce the Secretary not to
employ me upon the work the enterprise would fail. He seemed to be,
or chose to appear, ignorant of the fact that it was the Secretary of the
Treasury who was guiding the operations of the Division, and that I was
simply his agent in effecting its organization.

These charges were allegations only, and were not atempted to be. sus¬
tained by, proof. They had, however, a careful investigation by Mr.
Chase, who became satisfied of their untruth, and that they originated
only in interested, if not malicious, motives. He therefore dismissed them
as unworthy of his formal official action. They were subsequently with¬
drawn by the President of the Company and submitted by him to a
Committee of Congress. This Committee, after examining the charges,
and finding them wholly unsupported by proof, and that their author
stated in his testimony before them that “he knew none of them to be
true personally,” (Report, page 140,) refused to give them further ex¬
amination, or to enter them upon the record of the Committee. I am
not aware that the Company intends to reproduce them in any other
form, or before any other tribunal.

The American Bank Note Company, through its then President, Mr.
Edson, made an elaborate argument to your predecessor against the
organization of this Division, and endeavored to prove the greater
security which would result from having the work done by their Com¬
pany than would attend its execution in this Department. The argu¬
ment of Mr. Edson, which is the same since submitted by the present
President of the Company, Mr. Hatch, to a Committee of Congress,
was, that in view of the changes of Administration, to which the Gov¬
ernment was liable every four years, involving change in the authority
to produce issues, as well as to hold the custody of the plates, dies, &c.,
it was safer to trust the Company than some possible incumbents of the
Treasury offices hereafter.

I failed to perceive the cogency of this reasoning, as applied against
the Government and in favor of the Company. On the contrary, it ap¬
peared to me that its force, if it had any force, was against the Company
and in favor of the Government, inasmuch as the administration of the
Company is liable to change every two years, while the Executive term
of office is usually at least four. One of these changes of the Com¬
pany’s administration occurred under your predecessor, producing a
change of policy on their part, and imposing upon the Government the
necessity of trusting new agents.

Your predecessor was not convinced by this argument of any impro¬
priety in his efforts to produce the Government issues economically in the
Treasury, and therefore continued his exertions to that end.

Incidental and petty opposition, however, manifested itself almost
daily, and various obstacles to the growth of the Division were con¬
stantly encountered. Many of these were ingenious, and craftily devised;

others were simply stupid, and only served to show the agency of the
Bank Note Companies in producing them; but, as they have all been,
so far, successfully met and overcome, it is not deemed necessary to pro¬
long this report by their recital.

The next organized attempt to impede and prevent the success of this
Division came originally from the American Bank Note Company,
though other Companies, and parties in the Treasury, afterwards came
to its assistance in the work. This attempt, at its commencement, took
the same shape as that from the Continental Company, viz: personal
accusations against myself. An Opposition member of Congress was
induced to proclaim these charges on the floor of the House of Repre¬
sentatives, which he soon expanded into general charges against the sys¬
tem inaugurated in the Treasury for printing its notes and other Gov¬
ernment securities, and finally into charges against the Secretary of the
Treasury himself.

When the charges assumed this shape a Special Committee of the
House was demanded by one of its leading members, to investigate the
matter and report the result of its investigations.

Congress promptly raised this Committee, consisting of nine members,
and it was in session during the months of May and June, 1864. It was
organized on the 30th of April, 1864, and, on the 30th of June follow¬
ing, after what seemed to its members a very thorough investigation,
reported the result to Congress in a volume of nearly 400 printed pages,
in which they summed up their conclusion as follows:

“ Reviewing the whole case, the Committee are fully persuaded that
these charges were, in part, the result of an effort on the part of some
to break up the plan of printing in the Treasury Department, and partly
the result of a conspiracy on the part of Colonel Baker and the female
prostitutes associated with him, by the aid of coerced testimony, to de¬
stroy the reputation of Mr. Clark, and, by the odium thus raised against
the Treasury Department, shield himself and justify his unauthorized
arrest of one of the officers in the Printing Bureau. The injury thus
wantonly inflicted, and the publicity given to these shameful and un¬
founded charges, appear in a still stronger light when contrasted with the
exceedingly weak and inadequate evidence adduced to sustain them.

The Committee, therefore, report that the charge made by the honora¬
ble James Brooks, that the Treasury of the United States had been
“converted into a house for orgies and bacchanals,” is wholly unwar¬
ranted by the facts, in the highest degree unjust and injurious, both to the
Superintendent and employees in the Printing Bureau of the Treasury;
that the other charge, that millions and millions of the public money had
been sacrificed, and still more was in danger of being sacrificed, by the

system of printing public money now in use in the Treasury Department,
is not only unwarranted by tbe facts, but no evidence has been adduced
to show that a single dollar has been fraudulently issued under the sys¬
tem of printing now in use. On the contrary, the plan of doing the
work in the Treasury Department has facilitated the issue of the currency,
and very greatly reduced the cost of manufacture. It secures to the
Government the ownership and custody of the plates and dies, which
would otherwise remain in the possession of commercial parties in no way
officially connected with the Government.

The Committee find that Mr. Clark, the Superintendent of the Print¬
ing Bureau, has conducted the affairs of his department with great energy
and skill, and has made its operations successful against formidable ob¬
stacles and discouragements.”

The Committee closed their report with the following resolution:

Resolved, That the policy of printing public money in the Treasury
has resulted in a great saving’of expense to the Government, and security
against fraud, and the affairs of the Printing Bureau have been admin¬
istered with marked ability and integrity.

Thus ended the second organized attempt to break up this Division.
The examination of witnesses by this Committee was wholly ex parte.
No opportunity was afforded me, or any other representative of this Divi¬
sion, to refute the charges preferred against me, and against its system
of business. The charges were simply overruled' and rejected by the
Committee by reason of the absence of evidence to sustain them.

When I learned that this Committee was about to adjourn without
allowing me opportunity to defend myself, or the Division of which I had
charge, because, in the judgment of the Committee, no defence was neces-
sary, I addressed them a letter asserting the untruth of such charges as
were rumored in the newspapers, and asking to be informed what charges
were preferred against me or against the Division, and to be allowed op¬
portunity of disproof. This letter, though entered upon their record,
elicited no reply. A copy of the letter will be found in the Appendix,
marked F.

None of the requests enumerated in the letter were complied with, and
the Committee closed its sittings and reported, without hearing me or
any witness in my behalf, or in behalf of the Division.

It is therefore, in my judgment, not only a right, but a duty, to make
brief record in this report of the parties employed, and the proceedings
resorted to, to obstruct the Treasury policy, and accomplish the designs
of the Bank Note Companies.

The action of Congress is, at all times, to be respected by officers of

the Departments. I yield to no one in the great deference and respect I
ever manifest for its collective wisdom. But this does not impugn my
right to examine the action of an individual member, especially when the
action of that member is not sustained by his peers.

The member who was induced to proclaim the false charges on the floor
of the House of Representatives, was the Hon. James Brooks, of New
York. Having preferred the charges, he was, by the usual parliamentary
courtesy, placed by the House upon its Committee.

Of his fitness for the duty which thus devolved upon him, I prefer that
he should be his own exponent. In making the charges he stated, as re¬
ported in the Congressional Globe, that “ it was with the greatest diffi¬
culty he could organize a three cent newspaper establishment so as to
prevent stealing.” And again when before a tribunal of justice in New
York, charged with mutilating the ledger of a commercial company in
which he was a partner, with the intent to cheat one of his associates,
he said, upon the witness stand and under oath, as reported in the daily
papers:

Question by counsel. Look over this account and show me where the
discrepancy arises that you referred to in your direct examination.

Answer by Mr. Brooks. Oh, I can’t; I am no hand at figures; I do
not keep the accounts of my own house even; it would take me half an
hour or an hour to figure the thing up.

With this voluntary self-elucidation of his own competency and fitness
to examine and justly criticise the accounts of this Division for a period
of years, covering transactions which at times amounted to many millions
of dollars per day, I am not surprised that he said of me and my accounts
in his minority report to Congress: “ He keeps no ledgers, balances no
books, for an accountant to see and understand at a glance, The eye is
wearied and the mind fatigued by innumerable figures of his,” &c., &c.;
nor did it excite surprise that he should thus report, after he had pro¬
pounded to me, before the Committee, the following questions, and I had,
under oath, thus responded:

Question by Mr. Brooks. Is there anything like a record, showing
what has been done each day?

Answer. Yes, sir.

Question. Is there anything posted on one book so that you can see at
a glance what has been done in a single day in the different branches?

Answer. Yes; it is posted on a single sheet. You can go with me
to-night and see the report of the day’s work, showing the entire progress
of the day.

Nor need it excite surprise that when the lion. Mr. Brooks subse¬
quently examined these records, as he did, in my presence, on the 6th of
Mav following, that they 11 only wearied his eye and fatigued his mind,”
although these same records can be, and are daily, “ comprehended at a
glance” by many of the female employees of this Division.

During the time this Committee was in session, it is within my knowl¬
edge that the Hon. Mr. Brooks was in frequent, if not constant commu¬
nication with one or more officers of the American Bank Note Company.
Many of the questions propounded by him to witnesses, indeed all his
questions which were pertinent to the engraving and printing business of
this Division, bear intrinsic evidence of having been prompted by these
officers, or by some interested experts. They exhibited an expert knowl¬
edge which the Hon. Mr. Brooks did not profess to possess.

It appears also from the Committee’s report (page 185) that my evi¬
dence before that Committee was submitted by the Hon. Mr. Brooks, for
criticism, to one of the officers of the American Bank Note Company,
and that this officer was permitted to review that evidence in writing,
and publish his review with the Committee’s documents. (Report, page
367.) This was the more oppressive to me, in view of the fact that I,
the party on trial, was not permitted to see or know any charges or
evidence against me that were in the possession of the Committee ; while
an affidavit submitted by me in disproof of certain rumored charges was
abstracted from the files of the Committee without its Chairman’s knowl¬
edge, and without the knowledge of its clerk to whose custody it was con¬
fided, and was subsequently seen in the possession of one of the hirelings
of my accusers. It is also a* matter of notoriety that the American
Bank Note Company had been very lavish in its expenditure upon the
crusade against this Division. But it is only with the action of the Hon.
Mr. Brooks, in throwing difficulties in the way of the Division, and with
the instruments by which he was aided in that work, that this report is
concerned. It is beyond my power to sit in judgment upon his motives.

The chief coadjutor of the Hon. Mr. Brooks in his labor of promoting
the object of the Bank Note Companies was the man Baker, who had
been, and for aught I know still is, employed as a detective in one of the
Departments. As to Baker’s fitness to be an associate of the Hon. Mr.
Brooks in this work I know nothing.

Baker was ceaseless and untiring in his unscrupulous efforts for
many months in coercing testimony to form a conspiracy. The fact of
his coercing testimony being attested by the evidence of Mr. Jordan,
Solicitor of the Treasury, as given under oath before the Committee, and

the fact of his engaging in a conspiracy being certified by the Committee
of Congress, as already quoted. When this testimony so produced was
collated before the Committee it was, upon examination, promptly
i ejected, and refused a record. It may be that the great labor and time
devoted by Baker upon this business was thus gratuitously, and with no
other motive, devoted to the public good, though I do not know anything
in his reputed character or antecedents to warrant such a conclusion.

The efforts of the Hon. Mr. Brooks, even though aided by Baker, failed
to convince the Committee that there was any foundation for these charges,
but as the Hon. Mr. Brooks and the Bank Note Companies have widely
circulated printed copies of the subject-matter attempted to be introduced
as evidence before the Committee, they have engendered much prejudice
against this Division among those who only read their charges as pro¬
mulgated in the Hon. Mr. Brook’s New York newspaper, and in the
pamphlets printed for the American Bank Note Company. I have there¬
fore deemed it my official duty to present in my report this explanation
of the matter.

The President of the Continental Bank Note Company, Mr. A. C.
Wilson, also appeared before this Committee with charges against me,
and presented as part of his case, the report of a Committee of a former
Congress in reference to the discharge of my duties as Engineer of the
office of Construction under this Department. My reply to those charges
was made at the time to the then Secretary of the Treasury, Mr. Chase, and
placed upon the files of the Department. This reply was not before the
Committee. In justice to Mr. Chase, who placed me in charge of this
Division, after a Committee of Congress had reported against my employ¬
ment in the Bureau of Construction, (although Congress took no action
on that report,) I subjoin my letter of reply in the Appendix to this report
marked G-.

This Mr. Wilson’s original opinion of my defence against these charges,
brought against my official conduct in the Bureau of Construction, will
appear from the following extract of a letter, written by him to me at
the time he read my reply, and now on file in the Department. He
wrote: u I need hardly assure you of the absolute conviction of your in¬
tegrity which it enforces.” This was written by him on the 1st of July,
1863; but on the 7th of May, 1864, after his pecuniary interests were
unfavorably affected by my subsequent labors in this Division, he repro¬
duced before a Committee of the present Congress, and in proof of his
allegations of my “dishonesty and incapacity,” these charges made by a

Committee of a former Congress against my action as chief of the
Bureau of Construction.

I shall he glad of an opportunity to review and refute all of the charges
made before this Committee of the present Congress, but the Secretary
may not deem the rendering of this report such an opportunity, and I
therefore omit an examination of the charges in detail.

I forbear at present from making any further exposition of the difficul¬
ties and opposition which have been encountered in organizing and per¬
fecting the work under my charge. I think sufficient has been adduced
to show that this opposition emanated from those whose pecuniary inter¬
ests are affected by its success.

AMOUNT OP WORK.

The quantity and amount of work upon the Currency and Securities in
this Division from the date of its organization to the 1st of October,
1864, is properly divisible into three classes, viz:

First. Currency and Securities printed wholly or in part by the New
York Bank Note Companies, and finished in this Division. These aggre¬
gate 12,786,214 sheets, and amount to $629,305,900.

Second. Currency and Securities printed and finished in this Division.
These aggregate 6,693,257 sheets, and amount to $1,636,281,239.

Third. Securities which have been delivered to this Division by the
Treasurer of the United States and the Comptroller of the Currency, for
printing endorsements and certificates thereon. These aggregate 20,022
sheets, and amount to $52,375,350.

Class No. One.

CHARACTER OP ISSUE.

ISSUED UNDER ACT OP—

SHESTS.

AMOUNT.

The first class is composed of—

6 £ Coupon Bonds.

July 17 and Aug. 5,1801.

152,502

$122,501,500

5-20 C f Coupon Bonds, series 1 and 2.

February 25,1862.

391,203

200,221,500

0-20 0 f Coupon Bonds, series 3.

February 25,1862..

61,228

6,122,800

United States Notes.

February 25,1802.1

United States Notes..

July 11, 1862.1

10,128,911

237,998,600

United States Notes..

March 3,1803. J

Currrcncy of the National Banks.

June 3, 1804.

2,052,370

62,461,500

Totals.

12,786,214

$629,305,900

Class No. Two.

STATEMENT NO.j

CHARACTER OF ISSUE.

ISSUED UNDER ACT OF—

SHEETS.

AMOUNT.

The second class is composed of—

6 Coupon Bonds..'....

July 17 and Aug. 5,1861..

41, G99

§3,639,950

6 $ Registered Bonds...

July 17 and Aug. 5,1861..

4,200

367,500

5-20 G $ Coupon Bonds, series 3.

February 25,18G2.

203,304

115,075,750

5-20 G <6 Coupon Bonds, series 4.

February 25,1862..

278,31G

147,530,450

Certificates of Indebtedness.

March 1,18G3.

77,232

190,292,000

One year 5 j{ Treasury Notes.

March 3,18G3.

487,703

49,314,760

Two years 5 $ Treasury Notes.

March 3,1863.

150,658

121,606,000

Two years 5 i> Coupon Treasury Notes...

March 3,1863.

182,943

255,881,600

6 $ Coupon Bopds...

March 3,1863.

97,800

63,130,000

6 <j* Registered Bonds....

March 3,18G3.

42,230

133,125,000

Compound Interest Treasury Notes.

March 3,18G3.

62,355

18,400,400

Fractional Currency.

March 3,1863.

3,529,0G4

13,851,859

10-40 5 # Coupon Bonds.

March 3,18G4.

272,300

135,130,000

10-40 5 Registered Bonds.

March 3,1864.

16,487

96,736,650

7-30 Treasury Notes, with Coupons.

June 30, 1864.

147,532

110,580,000

Compound Interest Treasury Notes.

June 30, 1864.

1,109,374

181,619,320

Totals

6,693,257

SI, 636,281,239

Class No. Three.

CHARACTER OF ISSUE.

SHEETS.

AMOUNT.

The third class is composed -of— ,

Seven-thirty Notes received from the Treasurer of the United States.

967

$715,000

Certificates of Indebtedness received from Treasurer of the United States

880

2,117,600

Coupon Bonds received from the Treasurer of the United States.

6,445

4,951,450

Coupon Bonds received from the Comptroller of the Currency.

2,670

4,929,050

Registered Bonds received from the Treasurer of the United States.

6,697

14,973,550

Registered Bonds received from the Comptroller of the Currency.

4,363

24, 688,800

Totals

20,022

$52,375,350

The aggregate quantity which has passed through this Division is
therefore (19,499,493) nineteen million four hundred and ninety-nine
thousand four hundred and ninety-three sheets, and amounts to
($2,317,962,489) two thousand three hundred and seventeen millions
nine hundred and sixty-two thousand four hundred and eighty-nine
dollars.

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No. 3.— Five- Twenty six per cent. Coupon Bonds , First and Second series, issued under the Act of February 25,1861.

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Delivered to Register of the Treasury.

Delivered to Treasurer to be burned.

Five-Twenty Coupon Bonds , Fourth series , issued under the Act of February 25, 1862.

Continued

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40,000,000

$70,000,000

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20,500,000

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No. 16.—Five per cent. Ten-Forty Coupon Bonds, issued under the Act of March 3, 1864.

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No. 17 .—Five per cent. Ten-Forty Registered Bonds, issued under the Act of March 3, 1864.

No. 18 .-Seven-Thirty Treasury Notes, with Coupons, issued under the Act of June 30, 1864.

$12,420,000

330,000

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Delivered to Register of the Treasury....

METHOD OF PRODUCTION.

The “method of production” is the method inaugurated in advance
of the work, with such alterations and additions as experience, and the
different varieties of issues, have suggested.

The method of preparing the plates from which the Government issues
are printed is the same as is followed by bank note engravers. The
dies or bed-pieces are first engraved by the patient labor of skilful men
of genius upon flat pieces of steel, made artificially soft for the purpose.
The t im e occupied in this work varies from one to eighteen months, de¬
pending upon the difficulty and size of the work to be engraved. Scarce
any die can be properly engraved in less than thirty days, and the time
is more often reckoned by months. The large number of plates neces¬
sary for each kind and denomination issued, would preclude the printing
of the large amounts required, unless there was some method of repro¬
ducing plates quicker than to engrave them. They are reproduced
rapidly and perfectly by the Transfer process, as follows:

The original bed-piece or die alluded to, having the required vignette
or letters engraved in intaglio thereon, is made artificially hard by a
process similar to the ordinary process of “case hardening.” After
hardening it is placed in a transfer press, and a cylindrical piece of steel,
called a roll, made artificially soft, is placed upon it and rolled back and
forth under powerful pressure. The hard bed-piece being thus pressed
against the soft roll, transfers the engraving in reverse from the bed-piece
to the roll, i. e. the portions depressed (being the lines cut out of the steel)
on the bed-piece, appear raised upon the roll. This roll in its turn is
now made artificially hard, again placed in the press, and forced down
by the pressure upon a soft plate of steel, and rolled to and fro until its
reverse, being a copy of the original flat piece, is produced. This is the work
of but a few moments, and exactly reproduces, by repetitions of the pro¬
cess, as many perfect copies of the original, on steel plates for printing,
as are desired. From the plates so prepared the paper is printed, the
original bed-piece and roll being used only to produce plates for printing.

It is obvious that the risk of fraudulent use at this point of the work is
in the original bed-pieces and rolls. If these could be surreptitiously
used, plates exactly like those printed from in the Treasury or elsewhere
could be easily reproduced and printed fraudulently. To guard against
this risk, so far as the work in this Department is concerned, the bed-
pieces and rolls are kept in a massive iron safe, specially made for the

purpose with proper drawers and compartments. To this safe there are
three different locks. Three different custodians are appointed for the
safe, each of whom has a key to one of the three different locks. One
was appointed by the Treasurer of the United States, one by the Comp¬
troller of the Currency, and one by myself. It required the presence of
all three custodians to take any roll or bed-piece from the safe. These
dies and rolls are all numbered and recorded in suitable books, kept by
the principal custodian.

When a transferrer requires any particular roll or die, he makes ap¬
plication, through the superintendent of his division, upon the custodian,
stating the use for which he desires it. The roll is then delivered to him,
the delivery recorded in a book styled “ Record of Deliveries,” and the
transferrer’s receipt taken therefor, specifying the use which is to be
made of it. One of the custodians goes with the transferrer and sees
that the use specified in the receipt and upon the record hook, and that
use only, is made of it. When the transferrer has completed his work of
transferring, the roll is returned, the date of return recorded in the book
of deliveries, in a column prepared therefor, and the return to the
custodian certified by the initials of his associates upon the record. No
bed-piece or roll is left out of the safe over night. At the close of each
day’s work each transferrer returns what he may have in use at the hour
of closing, when the return is recorded, and they are again given out next
morning under like system, and new receipt taken. Thus the record book
will show the particular kind of work done at any period, the date at
which the bed-pieces or rolls were taken out, and the use that was made
of them.

These custodians have also the custody of the transferred plates, (which
are numbered and recorded,) when they are not in use for printing; and
their delivery to the superintendent of plate-printing is receipted for and
certified, the same as the delivery of dies and rolls to the transferrers.
The superintendent of plate-printing receives and receipts for these plates,
and gives them out each morning to his journeymen printers, under the
same system as rolls and dies are given out to transferrers, and they are
returned to him at night.

The principal custodian makes a report to me every night, in a printed
blank, of the bed-pieces and rolls taken out during the day, the nature
and kind of work produced from them,, the name of the transferrer to
whom they were delivered, and the fact of their return. This report is
certified by the initials of his associate custodians.

This method has, so far, prevented any fraudulent use of either dies,

rolls, or plates, and if experience suggests any further improvement in
the system, it will of course be adopted.

So much of the paper as is now made in the Department, (and it is
designed, ultimately, to make all that is used,) as will be understood from
a previous portion of this report, is manufactured in the cellar of the
building, by an agent of the contractor. By the terms of the paper con¬
tract, the room occupied for its manufacture is at all times under the con¬
tractor’s exclusive control, no one having the right of access to it except
the operatives, who are hired, paid, and controlled only by himself; unless
the contract is made perpetual, in which event the Secretary has the
power, if he so elects, to assume the control of the operatives, of the
machinery, and of the room occupied for the purpose of manufacturing.

The method of receiving and delivering the paper proposed by me in
December, 1863, and approved by your predecessor was as follows:

Proposed system of checks and balances for the receipt and delivery of
paper manufactured in the Department.

Treasury Department,
Washington City D. C., December 30, 1863.

Storeroom. —There shall be a convenient room set apart as a store¬
room, to and from which paper shall be received from the manufacturer,
and delivered to the superintendent of the counting division.

Appointment of clerk of paper room. —This room shall be in the
exclusive charge of a competent person, to be appointed by the Secre¬
tary, who shall be styled “clerk of paper room.”

Deliveries upon orders. —When the manufacturer has paper ready to
deliver, he shall notify the Chief of the First Division of the National
Currency Bureau of its kind and quantity. Upon such notice, the Chief
shall issue authority to the clerk of the paper room to receive it. The
notice and the consequent authority to receive shall be made matter of
record, and be in printed forms.

Duty of the clerk of the paper room. —The clerk of the paper room
shall receive the paper from the manufacturer and receipt therefor in a
pass-book, properly prepared, showing the date of receipt, size, weight,
and quantity. He shall, at the same time, record in a record book,
properly prepared, the same particulars, together with the price per
thousand sheets, and the value of each receipt and the date at which the
manufacturer’s bill is audited for payment.

Pass-book. — The pass-book will be retained by the manufacturer as a
voucher for his delivery, and the clerk of the paper room shall give the
manufacturer a receipt in a printed blank showing all these particulars,
and also give a duplicate receipt to the Chief who shall cause it to be
filed for future reference.

Bills rendered. — The manufacturer shall make out his bills from these
receipts and attach the receipts as sub-vouchers thereto, and present them
to the clerk of the paper room for examination and comparison with the
record.

Bills audited.— If found correct, the clerk shall endorse thereon the
reference to the First Auditor for settlement, in the same manner as
other bills are now referred for settlement and remittance.

Accounts vised by Chief. — These bills shall then go to the Chief and be
compared with his record ; if found correct, marked with his initials, and
sent to the chief clerk or Assistant Secretary, in the usual manner for
Reference to the First Auditor.

Delivery of paper. — The paper shall be delivered from the paper room
only in the following manner :

Requisitions. —The superintendent of the printing division, when in
want of paper, shall issue a requisition therefor upon the Chief, in a
printed blank, stating the size and quantity of the paper required, and
the use which is proposed to be made of it. Upon the receipt of the
requisition the Chief shall cause it to be filed, and issue thereon an order,
in a printed blank, upon the clerk of the paper room in favor of the
superintendent of the counting division, stating size, quantity, and use.
The superintendent of the counting division shall receipt for this order,
record it, and present it to the clerk.

Orders. —Upon this order the clerk shall deliver the paper, taking the
receipt of the superintendent in duplicate therefor, and file the order,
recording the delivery with all its particulars in the book prepared for the
purpose, and sending one copy of the receipt to the Chief. These orders
shall become his voucher in settling his paper account, to be adjusted and
treated the same as a cash account with a banker, checked upon by a
depositor.

Daily report. —The clerk of the paper room shall render a daily report,
in a printed blank, to the Chief, of paper received to date, received during
the day, delivered to date, delivered during the day, and balance on hand
at night.

Books for requisitions and orders. —The requisition of the superinten¬
dent of the printing division and the order of the Chief shall both be in
books with printed margins, and the margins shall be a record of the re¬
quisitions and a receipt for the order.

Printing. —The superintendent of the counting division shall record
her receipts from the paper room and their delivery to the printer,
charging them to the latter in a book prepared for the purpose, and ren¬
dering a daily report, similar in character and detail to the report of the
clerk of paper.

Counting division. —After printing, the paper to be returned to the
superintendent of the counting division, be there counted again, and, if
found correct, be credited to the superintendent of the printing division
in the same book in which it was charged, similar in effect to an ordinary
debit and credit account in a ledger.

The blank books, some twenty in number, were prepared in accordance
with the above system, but they are not now in use, because I am informed
by the paper clerk, recently appointed by you, that he proposes to change
this system. What the changes are to be I am not yet advised.

The present system in this Division is as follows :

The paper is delivered by the paper clerk in packages of one thousand
sheets each, to such superintendent of counters as may have charge of
the particular issue for which the paper is designed, counted by one of
her counters, the count verified by a second counter, each counter placing
her initials upon the package, and then entered in a book prepared for
the purpose, showing the quantity and size of paper, and the denomina¬
tion and kind of issue for which it is designed. It is entered in the book
both by the number of sheets and the amount of dollars the sheets are to
represent when finished. In all cases, after it enters the counting room,
it is treated and charged as so many dollars as well as so many sheets,
though it is, as yet, but white paper; and it is so treated in all stages of
the work in each and every sub-division. Each package is always two,
often three, and sometimes four times counted in this Division before
the paper is given out for work.

If the issue is one of a kind which requires bronzing, (the bronzing
being always the first thing done to the sheets,) the paper is delivered to
the superintendent of the bronzers, charged to him, and receipted for by
him in a book prepared for the purpose, which book is retained by the
superintendent of counters. It is also at the same time entered in a pass
book which goes to the bronzers with the paper.

The receipt in all cases, in this and all other sub-divisions, is given,
subject to count , on the day of its date. If the receiver’s count does
not agree it must be reported to the prior sub-division as soon as counted.
Thus it is a qualified receipt only for the day of its date, and a final
receipt after that day. The count is required to be immediate, and if
not found to be correct the counter is to report forthwith to the superin¬
tendent of the sub-division from which it is received. If this should,
by carelessness or design, be omitted by the receiver, the party deliver¬
ing is relieved from responsibility, and the party receiving is held respon¬
sible. In practice, however, such neglect has not yet occurred, the rule
operating to prevent it. The amount in sheets and dollars is entered
upon the bronzer’s record, and the count verified by the bronzer’s coun¬
ters. Thus the package is always counted for the third time (and some¬
times for the fourth or fifth time) by different counters before the work
is put upon the press.

It is then given out, in packages of one thousand sheets, to the bron-
zer’s operatives, and charged to each operative, when delivered, in a
book prepared for the purpose. After bronzing, it is returned to the
counting room, when the superintendent of counters receives it, giving
the bronzer her receipt in a bound book, and crediting the amount to the
superintendent of the bronzers in the same book in which it was originally
charged to him in the ordinary debit and credit form of a merchant’s ledger.
It is now again counted, for the fourth time. If the work is not to be
bronzed, it is given, after the second count, to the superintendent of the
plate-printing, so that the issues not bronzed are often but twice counted
before delivery for printing. It is delivered in like manner, whether bronzed
or plain paper, to the superintendent by charging it to him in a separate
book, and upon his pass-book, which goes with the bronzed or plain sheets,
and is entered upon the plate-printer’s record and counted by his counters,
in the same manner as the previous delivery to the bronzers.

The plate-printing room being in the attic, and the general counting room
in the basement, (a necessity growing out of the building being occupied
for both clerical and mechanical purposes,) the paper is placed in
boxes and locked up, (each superintendent having a key to the box,) and
elevated to the attic by a dumb waiter, which is itself locked after the
boxes are placed in it.

After it has been counted for the fifth time (or third time if not
bronzed) by the plate-printer’s counters, and entered upon the superin¬
tendent’s record, it is given out to the journeymen in packages of dif¬
ferent amounts. The distinction of 1,000 sheet packages cannot be
here literally followed from the nature of the work. It is given out in
such quantities, and at such times, as the particular work to be printed and
the particular kind of paper may require. It is necessary to take enough
to make a suitable mass in the wetting room. The journeymen printers do
not have access to the plate-printing counting room, where the paper to be
printed is kept, but receive their paper through an opening in the partition,
prepared for the purpose, and immediately counting it (for the sixth time if
not bronzed) before removing it, sign a receipt for the amount on a blank
slip prepared for the purpose, and filed for reference, which states the
quantity of paper received, and the kind of printing which is to be done
upon it. The delivery is at the same time entered upon the journeyman’s
pass-book, which he keeps, and the amount charged to the journeyman upon
the superintendent’s ledger. The first printing of the issues not bronzed
is for what is technically called the “ tints,” i. e. the green tinted work
on the face of the notes.

If the issue is for wet printing the paper is taken by the journeyman
to the wetting room, when it is wet down, as it is technically termed,
which is done by placing wet cloths at regular intervals between the
sheets, and the whole mass of paper and wet cloths then put between
thick hoards under heavy weights. In this state it remains from twelve
to twenty-four hours, when the journeyman relieves it from the weights,
separates the paper from the cloths, and reversing the position of the
sheets, again places it between the hoards and under the weights. It
thus remains until the whole mass of paper is evenly moistened and
mellow. When it is thus made ready it is taken by the journeyman in
such quantities as he may require, generally a day’s work at a time, to
the printing room to be printed. He takes only a portion of that which
he has wet, and adds each day to his pile of wet by obtaining more dry
paper from the counters, thus diminishing his pile of wet by so much as
he takes daily for printing, and augmenting it by fresh supplies. The
quantities thus taken are irregular, necessarily so, as some days the
journeyman will do more work than others, depending upon his physical
condition, the demand for work, and other causes. Thus each journey¬
man has at all times, until a given issue is completed and ended, a pile
of wet paper on hand which cannot readily be counted in that condition.
An informal settlement of the paper account of each journeyman is made
weekly, and a final settlement made monthly, when the wet paper not
printed is dried, counted, delivered back to the counting room, and cred¬
ited to the journeyman.

If the paper is given out for dry printing, the journeyman takes it
directly to the printing room, and his paper account is settled daily. The
dry printer never has any paper on hand over night, but gets his fresh sup¬
ply every morning, taking as much as he thinks he can print, and returning
both printed and not printed at the close of each day’s work. Thus the
dry printing method simplifies the work, and, enabling frequent settle¬
ments, avoids the risk necessarily attending wet printing.

To return to the wet printing. The journeyman takes his wetted paper
to the printing room, where he prints it upon the roller presses, with the
aid of a “helper,” (generally a young girl, who is paid by the printer,
not by the Government,) and after printing placed between dry sheets
called “backers,” to prevent the wet sheets from off-setting or trans¬
ferring from one to another. They are counted by the helper (for the
seventh time) and a thin strip placed between every tenth sheet. As soon
as the journeyman prints one hundred sheets, he sends them by his
helper, with his pass book, to the drying room,

The superintendent of the drying room and her counters receive the
one hundred sheets, receipt for them, count them (for the eighth time) and
they are then spread upon racks in the drying room, which is artificially
heated for the purpose.

The journeyman thus makes one-hundred-sheet-deliveries as fast as he
prints during the day, relieving himself at each hundred of so much of his
responsibility, and placing it upon the drying-room superintendent.
When his day’s work is finished, which may or may not be of even hun¬
dreds, he places such paper as he may have left, if any, under the weight
with his pile. During the day it is kept under wet cloths to keep it at the
proper moisture.

At the close of the day’s work, the superintendent of the drying room
places with the day’s work of each journeyman on the rack, a ticket, on
which is written the aggregate number of sheets for which she has re¬
ceipted in the pass-book of each, the name of the journeyman, the num¬
ber of the plate from which it was printed, (all plates being differently
numbered,) and the kind of work printed, which, in the case I am
describing, would be “tints.”

The printed sheets remain upon the rack until they are dry—from
twelve to thirty-six hours, depending upon circumstances. No one
is allowed to enter the drying room except those who are employed therein.
When sufficiently dry they are taken up and removed to an adjoining
room by the drying-room operatives, each journeyman’s work being kept
with his ticket, the “backers” removed and the sheets counted (for the
ninth time.) If the count corresponds with the tickets, the sheets are
sent, with the tickets, to the plate-printing counting room, when they are
again counted, (for the tenth time,) and if they are found to agree, the
amount is credited to the journeyman whose name is upon the ticket,
and the ticket is filed for future reference. Here the different piles are
mingled and again counted, (for the eleventh time,) into packages of one
thousand sheets each, with paper slips placed between each one hundred
sheets in the same manner as they were originally packed, ready to be
given out for a second printing.

In this second delivery to the journeyman, the receipts are marked
“ tints to backthat is, the receipt is for sheets which have had the
tints on the face of the note printed, and which are now given out again
to have the backs of the notes printed upon them.

The paper now goes again through precisely the same course as
already described : first to the wetting room, then to the printing room,
then to the drying room, and then back to the plate-printers’ counting

room, being counted as before in these transits, six times, and thus arriv¬
ing at the seventeenth count.

Again it is given out in like manner, the receipts being marked “back
to face,” showing that the tints and backs have been printed, and that it
is taken out to print the faces.

The paper pursues the same journey again, with the successive counts,
and is returned for its twenty-third count.

The printed sheets are now sent to the examining room, where they
receive their twenty-fourth count, and are there critically examined by
experts, the imperfect being separated from the perfect, and sent by the
dumb waiter, in the same manner the paper was brought up, perfect and
imperfect being treated alike but kept in separate packages, and delivered
by pass-book to the superintendent of the counting division on the base¬
ment floor.

Here they are counted for the twenty-fifth time, and if found correct,
the plate printer is credited with the delivery upon the same book in
which they were originally charged.

The next operation is to press the sheets, which have all necessarily
become rough or crumpled in the alternate wetting and drying which they
have received while being printed. For this purpose they are delivered
to the superintendent of pressing, and charged similarly to the delivery
to the printer. They are then counted, (twenty-sixth time,) pressed, and
returned to the superintendent of the counting who counts them (twenty-
seventh time) and if the quantity is found correct they are credited to the
superintendent of the pressing room in the same book in which they were
charged.

The superintendent of the pressing room keeps a record in a book
prepared for the purpose, showing the kind, denomination, and quantity
of work pressed by each of his operatives, and at the close of each
days work aggregates the amount done by each press upon his record book.

The sheets are next to be numbered. Some kinds are numbered by
consecutive notes, others by consecutive sheets. The Fractional Cur¬
rency is not numbered, but all other kinds of currency and securities are
numbered, each denomination consecutively by itself, whether of notes,
bonds, coupons, drafts, or checks. For this purpose they are delivered
by the superintendent of the counting to the superintendent of the num¬
bering room, and charged same as other deliveries; the latter counts
them (twenty-eighth time) and delivers them in parcels, generally of 100
sheets each, to his operatives, and charges them to each in books prepared
for the purpose, different books for each different kind of issue. After

numbering, they are returned to the superintendent of the counting,
counted (twenty-ninth time) and credited, as before, to the superintendent
who returns them.

Next they go to the superintendent of the trimming to have the edges
of the sheets trimmed by the trimming machines, being charged the same
as before. This superintendent counts them, (thirtieth time,) and delivers
them to the operatives in parcels of 500 sheets, charges them in books
prepared for the purpose to each operative, specifying the nature of the
work to be trimmed, its denomination, numbers, and gross amount. From
this point they do not again go to the general counting room, being now
delivered by the superintendent of the trimming to the superintendent
of the sealing, who counts, (thirty-first time,) relieves the trimmers of their
responsibility, and enters them upon his record. The red seals are
affixed in this subdivision by power presses, and the sheets are fed to the
presses by girls. Each feeder receives 500 sheets at a time, seals them,
and returns them to the superintendent, who immediately delivers them
in the same package and charges them to the superintendent of the
separating room.

This superintendent receipts and counts them, (thirty-second time,) de¬
livering them in like packages to her operatives, charging them to each in
the same manner as in other subdivisions. Tho notes being, up to this time,
four on a sheet, are here separated one from the other, and their sides
tiimmed by the separating machines, of which mention was made in the
early part of this report. The notes on each sheet are respectively
lettered by the engraver, A, 13, C, and D, and these separating machines
not only separate them from each other, and trim two edges of the upper
and lower note on each sheet, but place the notes in four different boxes,
each letter, A, B, C, and D, by itself, so that no two different check
letters are in any one package after separating.

In this division the Fractional Currency, or so much of it as is printed
dry, is separated by double acting automatic cutters. These cutters
take the notes in sheets—the sheets being of various sizes, from 20 to
50 notes on each sheet—separate them from each other, count them, and
place them in piles of five, ten, and twenty dollars, as the different
denominations may require. These Fractional Currency cutters were
expected to prove failures by all who saw them in course of construction.
Notwithstanding the condemnation which the plans received, it having
been deemed impossible to cut two ways at right angles with each
other at the same time in the same machine by a pinching motion
to simulate the cut of shears, I had an abiding faith that they would

work, and I have had the satisfaction of seeing them running success¬
fully for many months, each machine being capable of doing the work
of forty girls by hand labor.

From the separating room, the notes now finished and ready for issue,
are delivered to the final counting room, where they receive their last
count in this Division, (thirty-third time) and are placed in packages of
suitable decimal amounts. These packages are then sent in boxes, securely
locked, by two porters and a messenger, to the Treasurer of the United
States, who gives a qualified receipt on their delivery, or a receipt subject
to count. After the Treasurer’s counters have counted them, if found
correct, the qualified receipts, which are in a book of record, are marked
correct, and re-signed, and the responsibility of this Division is ended.

CHECKS AND BALANCES.

In the above “ detailed history of the method of producing the Govern¬
ment currency and securities,” the Secretary is incidentally apprised of
a portion “of the system of checks and balances adopted for the security
of the Government in that production.” It will be perceived that the
particular issue of which the production has been detailed, is counted
thirty-three times; that by these counts each subdivision becomes a check
upon that whose work preceded it. Each one of these superintendents
makes separate report, every night, of the operations of the subdivision
during the day, stating how much has been received from the preceding
division, and how much delivered to the one following, as well as an ag¬
gregate of the doings of the subdivision on that issue. These various
reports are compared and collated by the general book-keeper, and aggre¬
gated upon one book, (a separate book for each kind of issue,) called the
Superintendent’s Record. If the reports do not agree, if one superin¬
tendent reports the receipt or delivery of more or less than is reported de¬
livered or received by the next preceding or succeeding superintendent,
the discrepancy is explained and adjusted before entry upon the record.
Errors of fact —that is, errors in the number of sheets handled—do not
occur in these reports. The system of successive counting checks any
error of fact immediately upon its occurrence, when it is corrected on the
spot. Accountant s errors—that is clerical errors in the figures_‘some¬

times occur in the reports, from erroneous copying or wrong addition of
amounts, which the general book-keeper detects in making comparison
before recording. A condensed recapitulation of the work upon each
issue is made out from the superintendent’s record in printed blanks pre¬
pared for the purpose, and daily deposited in the Secretary’s office,

where they are examined and compared with the Treasurer’s and Regis¬
ter’s reports. The Treasurer and Register make separate reports to the
Secretary of what they have respectively received from this Division,
and I report to the Secretary what I have delivered to those officers.
These reports are compared daily by an officer detailed by the Secretary
of the Treasury for the purpose, who is in no other way connected with
the Treasurer’s or Register’s office, or with this Division.

None of the operatives, after they enter the room in the morning
where the notes and bonds are handled, are allowed to leave during the
day, except for sickness or other unavoidable cause; and none are per¬
mitted to leave at the close of work until the counting in every subdi¬
vision is finished, and the day’s work declared correct by each superin¬
tendent.

It is not supposed that this system is perfect. “ Perfection is not
among human conditions.” But it has been improved from time to time
as experience has suggested, and it is expected to continue its improve¬
ment until it is as near perfect as “human conditions” will admit. The
system has worked well in practice, and I see no present occasion to
change its principal features. What changes may be contemplated by
the new paper clerk I am not aware, but I should hesitate to adopt any
material changes, unless they manifestly increased the safety of pro¬
duction.

LOSSES.

The losses thus far encountered have been few, and no loss has occurred
to the Government.

The first loss of Treasury Notes occurred on April 14th or 15th, 1864,
in the plate-printers drying room. A parcel of eight hundred unfinished
sheets of twenty-dollar five per cent two years notes, printed on the 14th of
April, 1864, when returned from the drying room on the 15th, counted but
seven hundred and ninety-nine sheets. Thorough search was made with¬
out finding the missing sheet. The date and fact of the loss were recorded
and reported. Suspicion attached to a scrubbing woman who was employed,
under surveillance, to clean the room. Her movements were traced, and
the utterance of one of the notes, at a store on Pennsylvania Avenue,
discovered the next day. She was promptly arraigned and charged with
the theft, which she denied, though clearly proven. The matter was
placed in the hands of the Solicitor of the Treasury and the District
Attorney; but, as the stolen sheet was unfinished, and not legally money,
its only value being, consequently, the value of the paper upon which it

was printed, these officers thought it inexpedient to pursue the matter,
and the case was dropped with the dismissal of the woman from Govern¬
ment employment.

On the 27th of February, 1864, four sheets of Fractional Currency,
amounting to forty dollars, were missed from the plate-printers drying
room. No trace was ever found of them, and no sufficient suspicion
attached to any party. The loss was therefore assessed upon and paid
by all the occupants of the drying room where it occurred. It was
thought by some of these occupants that a new girl, then recently hired,
was the guilty party, although nothing in the shape of proof was adduced.
But there being other sufficient cause why she should not be employed,
(though she had been highly recommended to me by a Senator) her ser¬
vices were dispensed with, for rendered reasons, other than the loss of the
sheets.

Subsequently, on the 23d of July, 1864, another loss of ten sheets of
Fractional Currency of fifty cent pieces, amounting to one hundred dol¬
lars, occurred in another drying room of the plate-printers. This was
not recovered, and the loss was assessed upon the employees in that
room. The superintendent, Mr. Neale, had suspicion of the guilt of
some of them, but failed to obtain any proof; and I directed the whole
Divison to be discharged. This was done, and so many of them as the
superintendent had confidence in, were subsequently re-employed.

On the 10th of September, 1864, a loss of one sheet of four ten dol¬
lar Compound Interest Treasury Notes occurred in the sealing division.
No one was here suspected. (The losses in this and its adjoining subdi¬
visions are always known within an hour of their occurrence.) Diligent
search was made until a late hour, and all the operatives of the division
were carefully searched by a committee of their number, selected for that
duty, without finding the sheet; and it is a mooted question whether it
was not caught and utterly destroyed in the machines, or cut up so fine
as not to be found among the clippings. Its value was, however, assessed
upon the Division, the loss recovered, and no sheet of like number with
the missing one has been issued by the Treasurer.

These are all the losses which have occurred since the commencement
of the work. They aggregate of finished work, one hundred and eighty
dollars. The amount handled during that period was more than twenty-
three hundred millions of dollars. It will be observed that even these
comparatively trifling losses are not borne by the Government, but by
the operatives.

I doubt if the world’s history can parallel the handling of such an
amount of money by a manufacturing establishment, either Govern¬
mental or private, in the same period of time, with such small loss; and
the immediate discovery of such loss as has occurred is creditable to the
system in use.

The loss in the Treasury Department during the past year of one hun¬
dred $1,000 Coupon Bonds, amounting to one hundred thousand dollars,
which was discovered in June, 1864, did not occur in this Division,
although the package of bonds, from which the one hundred were ab¬
stracted passed through some of its subdivisions.

These bonds were printed by a New York Bank Note Company, and
forwarded by mail-car to the Loan Branch of the Secretary’s office,
where they were received, counted, and found to agree with the invoice.
The package, consisting of six thousand bonds of $1,000 each, numbered
from 29301 to 35300, was received from the Loan Branch by this
Division.

When the loss was discovered, a search was immediately made in this
Division, (by Mr. Bailey, clerk in charge of Loan Branch,) with the appa¬
rent expectation of finding here some trace of the loss.

The search was made on Sunday, the 5th of June, 1864, when none of
the superintendents of the subdivisions through which the bonds had passed
were present to explain the entries upon their records, when it plainly ap¬
peared that the six thousand bonds were received from Mr. Bailey by the
superintendent of the bond counters, on the 27th September 1863, counted,
found correct, and entered upon the record. From this superintendent
they passed on the same day, to the superintendent of the trimmers, and
were again counted, found correct, receipted for and entered upon the trim¬
mer’s record. After being trimmed they were delivered, on the same day,
to the sealing division, counted, found correct, receipted for and entered upon
the sealer’s record. After being sealed they were, on the next succeeding
day, returned to the superintendent of bond counters, counted, found
correct, and the return recorded. From thence they were, on that day
(September 28, 1863,) returned to the Loan Branch, counted in that office,
found correct, and Mr. Bailey’s receipt for the exact quantity taken upon
a book of record. Mr. Bailey delivered them to the Kegister of the
Treasury, and from the point of delivery to the Register, no methodical
or recorded trace of them exists.

Thus it will be perceived, that nine months after they were handled in
this division, a perfect recorded history of such handling appears upon the
record, which was “comprehended at a glance” by one not familiar with

the books, without any explanation from, and even without the presence
of those who made the record.

This occurence, in my judgment, forcibly illustrates not only the
merit of the system established in this Division, but also goes to show the
soundness of the general principle upon which that system is based,
viz: that “ nothing representing values , or intended to represent values ,
ever changes hands without a count , and a receipt in a hook of record;”
and also enforces the rule which I have had the honor to submit, for
consideration, to both yourself and your predecessor, that “ the fewer
human hands that handle the money the letter for its safety, as the more
immediate and direct the delivery can he made from the manufacturer
of the money to the officer authorized to make lawful issue , the less will
he the liability to loss.”

The experience had in this Division, and the losses above narrated, go
to show, in my opinion, that the time, thought, and labor bestowed upon
the system in use to prevent losses, has not been bestowed in vain.

SAVINGS.

The saving to the Government by producing its issues in the Treasury,
instead of producing them by contract in New York can only be approxi¬
mately stated in this report. There has not been time, since the report
was ordered, with the force at my command, to make a careful statement
in detail for the Secretary’s information. Since the death of my principal
book-keeper, in September last, his place has not been supplied, and I
have consequently been without sufficient aid, and have been compelled to
rely principally upon such time as I could personally devote after each
days work was finished, to keep the books and accounts of my office in
proper order. The prompt and satisfactory performance of this work,
in connection with my other duties, has required the utmost diligence and
energy which I could command, with constant application for from twelve
to fifteen hours of each day for seven days in the week. Without serious
hindrance to the daily public business, and the risk of my accounts getting
in confusion, such a statement in detail could not be prepared during the
period that has elapsed since the Secretary’s order was issued to prepare
the present annual report. To prepare it, even in its present imperfect
and incomplete form has required more time than I could possibly take
from other duties, except by devoting nearly the whole of each night to
labor.

I propose, at the earliest possible moment to submit to the Secretary a
carefully prepared statement in detail, showing the actual saving effected
by this division.

I propose to do this in the following manner: First, to take the entire
disbursements on account of this Division from its commencement to the
first of October 1864, and from this amount to deduct the value of all the
machinery and tools on hand at that date, as well as the cost of the stock
of paper, ink, plates and other material, not then put in use. I propose
also to make the further deduction from this amount of the value of all
such work done, as was done upon the issues by the Department before this
Division was organized, such as trimming, sealing, separating packing,
&c.; the sum then remaining will represent the actual cost of all the
work done up to that period, which had before been executed outside of
the Treasury.

I then propose to compute the cost of all the work done in the Treasury,
at the prices paid before this Division was organized; the difference be¬
tween these two sums, so ascertained, will of course show the exact amount
saved to the Treasury by this Division to that date. From the data
already accumulated, I estimate with confidence that the amount saved
will prove to exceed two millions of dollars. [See Appendix , page 166.]

COMPARATIVE COST.

The cost of the issues produced in the Department, has generally been
about one-fourth the amount which the same issues would cost under the
former contracts with the New York Bank Note Companies.

The amount paid these Companies for printing the United States
Notes, for 14,245,552 impressions was $1,516,297 38. The cost of
the same work, if done in the Department, as ascertained and made
of record on the 13th of November, 1863, would have been $413,899 93.

The cost of printing the third series of Five-Twenty Bonds in the De¬
partment was accurately ascertained and recorded on the 24th November,
1863. A careful account of every item of cost had been kept as the work
progressed, and the result showed the actual cost to be $43 21 for each
thousand impressions. The price paid the Bank Note Companies for the
second series of Five-Twenty Bonds, was $171 for each thousand
impressions.

The comparative cost of the Fractional Currency as engraved and
printed at the Department, with the cost of the Postal Currency as
engraved and printed by the New York Bank Note Companies, was elabo-

rately computed on the 28th of January, 1864, with the following result.
I quote from the Record Book, vol. 2, page 254:

“ The comparative cost of Fractional Currency and Postal Currency,
computed at the prices actually paid, is—

Fractional.

Of 50 ct. pieces per $1,000 . $1 59

Of 25 “ “ “ 3 08

Of 10 “ “ “ 6 71

Of 5 “ « « 13 43

$6 97
13 94
28 87
55 75

$24 81 $105 53

The ‘Treasurer’s assortment’ of $50,000 would cost—

Of Postal Currency. $1,128 51

Of Fractional Currency. 262 61

Saving on each $50,000.

$865 90”

Sufficient time has elapsed since the above results became known, to
show, among other things, their effect upon the prices demanded by the
Bank Note Companies for their work in producing the issues of the Gov¬
ernment. When the proposals for the work upon the Currency of the
National Banks were invited, one of the New York Companies submitted
its proposal for transferring the necessary plates at one thousand and
fifty dollars per set. I then endeavored to prove to the Comptroller of
the Currency that the plates could be transferred in the Treasury for one
hundred dollars per set. My representations, I regret to say, were not
sufficiently convincing to cause the work to be done in the Treasury.
They had, however, the effect to induce the Department to resist the
Companies demands. These demands were, from time to time abated,
as my predicted results of the work in the Treasury became more and
more likely to be realized, until one, if not more of the Companies, now
offer to contract for transferring the plates necessary for the new issue,
(authorized by the present Congress,) at one hundred and fifty dollars
per set—an abatement of nine hundred dollars per set from the original
demand. On the number of sets necessary, this difference alone would
amount to more than one million of dollars.

If there is, to these Companies, a satisfactory profit on their present
prices , when materials and labor cost more than twice as much as they did
when their first proposal was made, it is not a forced inference that the
“comparative cost” in the Treasury with the prices originally paid to the

Companies, warranted the organization of this Division, and justifies its
continuance.

The cost of producing issues in New York, instead of in the Treasury,
is further augmented by the cost of transmission from New York to
Washington of the printing executed by the Bank Note Companies. The
charges for transmission to the Government, though reported to be much
less than the charges to individuals for like service, still aggregate
a large amount; and on some of the issues the cost of transmission alone,
exceeds the entire cost of producing in the Treasury. For instance, the
charge for transmitting the Registered Bonds from New York to Wash¬
ington is fifteen cents for each thousand dollars transmitted. Two pack¬
ages of Registered Bonds were recently delivered to this Division, printed
in New York and transmitted by Express, marked to contain thirty-two
millions of dollars. Each of these packages could have been carried by
hand. The contract price of transmission would be forty-eight hundred
dollars. The same amount of this issue of the same denominations could
have been printed in the Treasury for one hundred and ten dollars.

Within a few days sixteen millions of dollars of the same bonds were
received in one package which could be carried by hand. The contract
price of transmission was twenty-four hundred dollars. The cost of print¬
ing these in the Treasury would have been but sixty-three dollars.

These facts urge the economy of printing in the Treasury more forcibly
than any comment I can make upon them.

COMPARATIVE SECURITY.

The comparative security of producing the Government paper issues
under the immediate direction and control of the Secretary of the Treas¬
ury, and of producing them by contract in New York out of such control,
seems to me obviously in favor of Treasury production upon the simplest
statement of the case. Who has ever doubted that the issues of coin are
produced at the mint with greater security than would have attended their
production under contract by some of the different metal workers in the
northern cities? Why do not the same conclusions and the same reasons
apply with equal force to the paper issues of the Government ?

The greater security to Government in producing its own paper issues
may be further illustrated by comparing the difference of protection to
the Government against any printed notes getting into circulation, through
dishonest employes, by the two methods of production.

For example: The Department has no knowledge of how much paper

the Bank Note Companies, may give to their employes to be printed, nor
how much of such paper is returned after printing. This knowledge is
confined exclusively to the officers of these Companies and their printers.

In this Division every sheet delivered for printing is not only recorded,
but receipted for in a book of record; and every sheet returned is also
recorded and receipted for upon the same book. And these books of
record are subject at all times to the inspection of the Secretary, or any
officer he may designate for that purpose. Every sheet delivered is re¬
quired to be returned, printed or not printed, in whatever condition it
may be.

The comparative security may be further illustrated by a comparison
of the checks, in each method, upon the gross amount produced.

The Department has no knowledge of how much money the Companies
may print upon a given order. It may order a hundred thousand im¬
pressions of a named issue, from New York, and it receives a like num¬
ber upon that order from the contractors. But whether one or more
hundred thousand additional have been printed, is known, and can be
known only to the officers of the company executing the work. In point
of fact it has occurred that a large quantity of United States notes were
printed or partially printed, not only in advance of orders from the Sec¬
retary, by the American and National Bank Note Companies, but in ad¬
vance of any authority given by Congress to issue the money so printed.

In this Division the Department has not only an accurate knowledge,
but a perfect record, open for inspection at all times, of every sheet
printed of any given issue, as well as a daily report to the Secretary,
made up from that record.

That notes printed by the Bank Note Companies have got into circu¬
lation, apparently without the knowledge of those Companies’ officers, is
matter of record in the Department. Notes, which bore upon their face
indisputable evidence of such surreptitious issue, have been presented and
paid at the Treasury, and ultimately redeemed by the Bank Note Com¬
panies, thus obtaining their admission of false issue. But how many
notes have thus fraudulently obtained circulation, the Department has no
present means of ascertaining.

That the check upon production, established by these Companies for
their own protection is insufficient, is proven by two marked occurrences
in this Division. In one case, one of the New York Companies sent to
me a package containing one thousand more impressions—amounting to
eight thousand dollars—than was marked upon the package or included
in the invoice. I immediately notified the proper officers of the Company

of its receipt. They at first denied the sending of the excess. Even
after the sheets -were converted into lawful money, and I had deliv¬
ered the amount to the Treasurer of the United States, and obtained his
receipt therefor, they still refused to admit the sending of the excess. It
was not until such excessive sending was proven upon them by the con¬
secutiveness of numbers that they reluctantly admitted the error, and
rendered a bill for the printing. In the other case, another New York
Company sent me an excess of one hundred impressions— amounting to
four hundred thousand dollars—more than was marked upon the package
or included in the invoice. I immediately notified them, both by tele¬
graph and mail, of the error. In this case the succeeding day’s mail
brought an acknowledgment of the error.

The comparative security may be still further exemplified by a com¬
parison of the two methods in respect to the mutilated and imperfect
products.

More or less of the paper printed, both by the Companies and at the
Treasury, is imperfectly printed, or otherwise made unfit for proper issue,
in the process of production. Some is spoiled in the earlier stages of
the work, in such condition that it would cause no loss to the Govern¬
ment if it should get into dishonest hands; while some is spoiled when
so nearly completed that it would readily pass from hand to hand without 1
question, if it should get into circulation.

Of the quantity thus made unfit to issue by the Bank Note Companies
in producing some twenty millions of impressions, no one in the
Treasury Department has any knowledge, or can have any knowledge;
nor can its amount, with certainty, ever be known to Treasury officers.
No report is made of it to this Department—no Treasury officer has
inspected it; neither is the method by which it was destroyed known to
the Treasury, nor whether it has been destroyed at all. If it has been
burned, the evidence of such burning, and the circumstances attending
it, have never been reported at the Treasury. All that the Department
knows, is, that a certain number of perfect impressions have been received.

In this Division, on the contrary, every spoiled sheet, no matter in
what stage of the work it has occurred, is made matter of record on the
day in which it occurs; the sheet so spoiled is defaced under Treasury
Regulations, and delivered to the Treasurer, in the same manner and
under like receipt, to be as rigorously examined and carefully treated, as
the perfect money. The Treasurer receives and counts it, and after
recording the count, cuts the spoiled sheets in two parts, sending one

part to the Secretary’s office, and the other part to the Register’s office.
These parts are then separately counted by different counters, in different
offices, the counts compared, and if found to agree, the whole is burned
under the direction, and in the presence of a committee of four—one of
whom is from the office of the Secretary of the Treasury—a second from
the office of the Treasurer of the United States—a third from the office
of the Register of the Treasury—and the fourth is an appointee of the
Secretary’s, who is not connected with the Department, but selected for
his known integrity and familiarity with such business. These officers
unite in a certificate, showing the amount and the nature of the issues
burned, and the date of such burning.

The comparative security to. the Government by these two methods
requires no comment.

Additional comparative security enures to the Government by printing
at the Department, from the fact that the risk of transmission is avoided.
The money transmitted from New York to the Treasury was originally
sent in leather pouches by the mail cars. It is now sent by Express.
That which is printed in the Treasury, is delivered as soon as finished,
directly to the Treasurer of the United States, counted and receipted for
by him, and placed in his vaults. All risk of accidents upon the road,
*or robbery while in transit from New York, is thus avoided.

It seems to me unnecessary to farther elucidate the “ comparative
security ” of the two methods, for I think it must he apparent to the
Secretary that the Treasury production is the more secure, without even
these exhibits.

COMPARATIVE CELERITY.

The speed with which the work is produced in the Treasury, differs
in favor of such production from the speed with which it was produced
under contract, mainly in the matter of printing the issues.

The original engraved stock can be even more rapidly produced at
present by the Bank Note Companies than it can be produced in the
Treasury, for the reason that a larger staff of artists happens to be em¬
ployed now by these Companies, than is yet employed in the Treasury.
The peculiar talent required for the finer and more difficult portions of
hank note engraving is very rare, and the largest part of it is controlled
by the American and National Bank Note Companies of New York.
These Companies at one time were the only parties with whom this talent
could find employment at adequate pay. The possessors of this talent
were not generally possessed of the means or facilities for coming in im-
19

mediate contact with the banks, to whom alone their services were then
valuable. The Companies had a monopoly of the work for the hanks,
and the artists were thus forced to rely on them for employment. Taking
advantage of this fact, the officers of these Companies have compelled the
artists into engagements which forbade them, under severe penalties, from
doing similar work for any other parties. The artists have not, therefore,
felt at liberty to enter the service of the Government, though many have
expressed a desire to do so if they could be honorably released from their
engagements to these Companies without pecuniary sacrifice. On my
part I have not been willing to offer them inducements to enter this Divi¬
sion while they were under these engagements, as I did not desire to in¬
terfere with the private business of these Companies, or to lessen their
facilities. When these artists’ engagements terminate, they will seek
employment here, and if the Government should then need their services,
its staff of artists can be increased. So far I have confined myself to
hiring those only who were disengaged.

In all the other elements of production, the celerity is in favor of the
Treasury work. Particularly is this true in the matter of printing.

As the Companies originally charged a large price for each new plate
transferred, it was for their interest to print as few impressions from each
plate per day as the Department would allow, and thereby secure the.
making of a larger number of plates. The contrary is true of the Depart¬
ment work. It is for its interest to produce the largest number of im¬
pressions from each plate, and to make only just so many plates as could,
by the greatest diligence and largest time devoted, produce the number
of impressions required. To this end I have, when the public service
required it, employed two sets of hands upon each plate, and frequently
three sets, each set working eight hours, and thus getting twenty-four
hours work each day, from each and every plate.

The highest number of impressions that the Bank Note Companies
have offered to print from each plate daily, has been six hundred, while
from bond and other large plates, they have alleged that they could give but
two hundred and fifty impressions per plate. In the Treasury I have
produced, when the exigencies of the service required it, two thousand
impressions per day from each plate.

I have thus attained the maximum number of impressions at the mini¬
mum cost for plates.

The “ celerity is also in favor of the Department by so much time as
is lost in sending the orders to New York, and transmitting the work in
return. Irrespective of this time, the Companies possess the power to

print as rapidly as in the Treasury, but it would appear that it is not
always for their pecuniary interest to exercise that power.

RECOMMENDATIONS. •

The Secretary directs me to state what legislation, in my judgment,
is necessary, if any, for the future operations of this Division, and to
make such recommendations for his consideration as my experience in the
work may dictate.

In my judgment, this Division, which now only exists ex necessitate
rei, should be organized by law as a distinct and separate Bureau, to be
entitled “ The Engraving and Printing Bureau of the Treasury Depart¬
ment” The necessity for paper issues, in some form, is likely to be
co-existent with the public debt, and the production of such issues in
connection with the production of the currency for the National Banks,
and the large amount of printing and engraving required for the various
drafts, checks, and certificates of the Treasurer, Assistant Treasurers,
and disbursing agents, will give ample employment for such a Bureau, if
permanently organized and established by law. The Internal Revenue
stamps, postage stamps, envelopes, postal money orders, and all similar
work for other Departments could be more economically and safely pro¬
duced by such a Bureau, than by the present method of contracting with
individuals or private corporations. Much other incidental work would
also naturally he done under such a Bureau.

The work should all be executed in a fire-proof building, to be erected
and exclusively occupied for this purpose. A substantial but not costly
structure should be built on the grounds adjacent to the Treasury Build¬
ing, and communication between it and the rooms occupied by the
Treasurer of the United States should be made by a subterranean passage
between the two buildings through which the printed values could he
transmitted, thus avoiding such risk of transmission as attends the present
method of carrying the finished money through the main halls and pas¬
sages of the Treasury, to which both the public and the Treasury force
have free access. The experience of the past two years in this Division,
in connection with the detailed descriptions which have been obtained of
the construction of the buildings in which the Banks of England and of
France prepare and issue their notes, will enable the interior accommo¬
dations to be economically and conveniently planned for the safe prose¬
cution of the work, if such a structure should be authorized by Congress.

The Head of the Bureau should be appointed by the Secretary of the

Treasury, subject to confirmation by the Senate. Its affairs cannot, in
my judgment, be successfully administered by a division of its responsi¬
bility under different Heads. One Chief, and one alone, should guide its
detals, under the general direction of the Secretary of the Treasury, to
ensure its economy, safety, and efficiency. Perfect integrity, with a
familiar knowledge of all the details of the work to be done, should be
combined in this Head, and about him every possible guard should be
thrown, to prevent all opportunity for fraud or malfeasance.

A rigorous system of accountability—frequent, and where it is possi¬
ble, daily adjustment of accounts—regular and systematic daily reports,
to be carefully scrutinized and tested by competent officers not connected
with the Bureau, will be found essential safe-guards; and these if properly
systemized and made of record, will, at all times, satisfy the Department
and the public of the daily condition of the trust. But no system, how¬
ever ingeniously and skilfully devised will compensate for lack of integ¬
rity ; and freedom from all desire of gain should largely characterize
the incumbent of such an office. Men of such character, amply qualified,
are readily found, if sought for in the proper walks of life. They are
to be sought for the office as they are not seekers after office. The
merchant and manufacturer find no difficulty in getting such men
for private establishments, and Government need not, if it seeks in the
same quarter and offers like inducements for permanency upon proper
discharge of the trust and performance of the duties. The salary should
be sufficiently large to ensure a maintenance with reasonable accumulation,
and the tenure of the employment should not be subject to political changes.
The employment should continue so long as the duties are well and faith¬
fully performed.

The employes upon the work should be hired and discharged, on their
merits, by the Head of the Bureau alone, who should be held strictly
accountable for the integrity and good conduct of all his subordinates,
for the correctness of the accounts, and for the safe handling of all the
products. To this end he should be empowered to make such rules and
regulations for the guidance of these subordinates as he is willing, per¬
sonally and officially, to abide the result of. Any method of business,
which places out of his control the complete power over his aids, or which
lessens the belief and knowledge of that power among them all, will, I
feel the strongest conviction, result in disaster. Experience proves that
the adoption of such guides for the employment for these responsible
mechanical operations, as usually guide appointments for clerical pur¬
poses, do not result satisfactorily. The Head of the Bureau should

select his aids solely for their fitness for the work and its responsibilities,
irrespective of the locality of the applicant, or his professed claims for
Government patronage, or of any political or partisan influence which
may be brought to guide such selection.

I feel the more free to place my views on all these matters—the result
of much experience and study—upon the record, because I cannot, under
any circumstances, continue much longer in charge of the work, even if
it should be desired. I have, therefore, no selfish ends to promote, and
record my deliberate judgment with the sole view to the safe and efficient
prosecution of the work, and of the public good.

If my suggestions, or any of them, meet the Secretary’s approval, I
respectfully recommend that the proper legislation be asked for, to carry
such of them into effect as accord with the Secretary’s judgment.

An Inventory of the Stock on hand will he found at the close of the
Appendix.

I have the honor to be, very respectfully, your obedient servant,

S. M. CLARK,

Chief of Division.

Hon. Wm. P. Fessenden,

Secretary of the Treasury.

CONTENTS.

Origin of the Division. 4

Growth of the Division. 49

Present condition of the Division. 44

Difficulties encountered.. 47

Amount of Work. 54

Tabulated Statements of Issues. 56

Method of Production. 69

Checks and Balances. 79

losses.,. SO

Savings. S3

Comparative Cost. S4

Comparative Security.'. S 6

Comparative Celerity. S9

Recommendations. 9 j

APPENDIX.

A. —Contract of Continental Bank Note Company. 95

B. —Contract of American Bank Note Company. 99

C. —Proposed System of Checks and Balances. 103

D. —Report upon the Manufacture of Paper. 10 S

E. —Contract with Stuart Gwynn.•. Ill

F. —Letter to the Hon. Mr. Garfield. 115

G. —Letter to the Hon. S. P. Chase. 120

Inventory of Bed-Pieces, Rolls, Ac... 131

Inventory of Paper. 165

Extract from Report of Special Committee. 166

Extract from speech of Hon. J. A. Garfield. 167

Letter from Chief Justice Chase. 168

APPENDIX.

Contract between the Continental Bank Note Company and the United
States of America.

This contract, made and entered into this thirtieth day of July, in the
year of our Lord one thousand eight hundred and sixty-three, by and be¬
tween Salmon P. Chase, Secretary of the Treasury, for and in behalf of
the United States of America, of the first part, and the Continental Bank
Note Company, of the second part, witnesseth:

That the party of the second part, for the consideration hereinafter
mentioned, has agreed, and does hereby covenant and agree, to engrave or
cause to be engraved, in the highest style of art, on suitable steel plates,
certain designs, to be hereinafter enumerated, for five and ten dollar
notes. The engraved portion of the notes to be of the uniform size of three
by seven inches; and after the engraving of the same shall have been
approved by the party of the first part, to cause the same to be skilfully
and properly transferred to suitable rolls, and to make therefrom proper
plates for printing, in such quantities as may be ordered by the Secretary
of the Treasury.

The party of the second part further covenants and agrees to do and
complete the above work, and deliver to the Comptroller of the Currency
in the Treasury Department, or to hold and safely keep, subject to the
order of said Comptroller, the bed-plates or dies so prepared, together
with one set of plates for each denomination, properly lettered, within
three months from the date of the approval of the model, as hereinafter
provided for.

The designs above alluded to shall be as follows: For the obverse of
the five-dollar ($5) notes there shall be engraved upon the left-hand por¬
tion of the note a vignette representing the “ Discovery of America by
Columbus ,” and on the opposite or right-hand end of the note a copy of
a symbolic design this day delivered to the manager of the Continental
Bank Note Company, entitled “America presented to the Old World”
Between these two vignettes shall be engraved two legends as follows:

In the upper part of the space between the vignettes the following
legend, viz : “ National Currency. This note is secured by the bonds of
the United States, deposited with the Treasurer at Washington ,” together
with the engraved fac similes of the signatures of the Treasurer of the
United States and the Register of the Treasury.

In the lower part of the space between the vignettes the following

words : “ The First National Bank of Washington, L. O., will fay the
bearer five dollars on demand at their office in the city of Washington,
District of Columbia and suitable blanks shall be left for the date and
for the signatures of the president and cashier of the association.

In the upper right-hand corner of the note the figure five is to be en¬
graved, of suitable size, and a space to be left for imprinting the Treasury
seal upon the right-hand end of the note. The whole to be surrounded
by a suitable border, in which the figure 5 and the letters f-i-v-e shall
be often repeated in different characters.

For the reverse of the five dollar ($5) note there shall be engraved in
a central elliptical vignette, two and a half by five (2J by 5) inches, a fac
simile of Vanderlyn’s painting in the Capitol, entitled “ Landing of Co¬
lumbus." Above this vignette shall be engraved the legend expressing
the uses of the note, and below it the legend expressing the penalties for
counterfeiting. The words of these legends to be prescribed by the Sec¬
retary of the Treasury.

At each end of the vignette, oval spaces, one by one and a half (1 by 14)
inch shall be left. For one of these spaces there shall be engraved a suitable
die or bed-plate for surface printing, and a roll made therefrom (after its
approval by the Secretary of the Treasury) of the national shield; and for
the other space an appropiate device, with the words “ Issued from the
District of Columbia." These dies shall not be transferred to the note
plates, but twelve (12) transfers therefrom shall be made upon separate
plates of steel, and these, with their dies, &c., shall be delivered to the
Comptroller of the Currency, or held subject to his order, as hereinbefore
provided.

The words First National Bank shall be engraved above the central vig¬
nette, and the words “ Washington, D. C.," shall be engraved below it.
The two lines so engraved to be between the vignette and the legends.

The corners shall be filled with proper counters, indicating the denom¬
ination of the note, and the interstices be filled with work of a character
to add as much as practicable to the security of the note against counter¬
feiting. The whole to be surrounded by a suitable border.

The ten dollar (10) note to be similar in character to the five-dollar
note; but the left-hand vignette on the obverse to be from the design en¬
titled “ Franklin and the Lightning," and the opposite or right-hand
vignette to be engraved from a symbolical design entitled “ America
grasping the Lightning," this day delivered to the manager of the
Continental Bank Note Company.

The vignette on the obverse to be a fac simile of Powell’s painting in
the Capitol, entitled u De Soto discovering the 3Iississipi."

The designs on the reverse of the five and ten dollar notes to have
suitable title tablets engraved in the central lower portion of the vignettes.

Models of the notes made in accordance with this contract to be
submitted to the Secretary of the Treasury, and to be approved by him
before engraving.

The party of the first part, acting in behalf of the United States of
America, covenants and agrees, upon the satisfactory completion of the

aforesaid dies or bed-plates, rolls, and plates, and their surrender to the
Comptroller of the Currency, to pay therefor as follows:

For the bed-plates or dies, rolls, and one transferred plate of the five-
dollar ($5) note, the sum of two thousand two hundred and fifty dollars,
($2,250.)

For the bed-plates or dies, rolls, and one transferred plate of the ten-
dollar ($10) note, the sum of two thousand doljars, ($2,000.)

It is further understood and agreed that four notes shall be symmetri¬
cally transferred upon the plates, with a space exactly one-eighth (J) of
an inch between them, so that the united width and spaces of the notes
upon the plates shall be twelve and three-eighths (12§) of an inch (United
States standard) from the outward border of the upper note to the out¬
ward border of the lower note.

It is also covenanted and agreed between the parties hereto that the
party of the second part shall execute, with two or more good and suflicient
sureties, a bond to the United States in the sum of fifty thousand dollars,
conditioned for the faithful performance of this contract and the agree¬
ments and covenants herein made by the said party of the second part,
and for the custody and safe-keeping of the work to be executed under
this contract.

It is also covenanted, agreed, and understood that no member of Con¬
gress, or other person whose name is not at this time disclosed, shall be
admitted to any interest in this contract; and in the event of the Depart¬
ment becoming satisfied that any other party or parties than those herein
mentioned have either a contingent or direct interest therein which may
appear to the party of the first part to be prejudicial to the interests of
the work or of the Government, then the said Secretary shall be, and he
hereby is, empowered to cancel this contract, and relet the same.

It is further covenanted and agreed by the parties hereto, that this
contract shall not be assigned, except by consent of the Secretary of the
Treasury; and that any assignment thereof, except as aforesaid, will be
a forfeiture of the same, and shall subject the said party of the second
part and his bondsmen to such damages, to be recovered of them by suit
in the name of the United States, is shall have been suffered by the said
party of the first part.

In witness whereof, the said Salmon P. Chase, Secretary of the
Treasury of the United States, as aforesaid, for and in behalf of the
United States, hath hereunto subscribed his name and caused the seal of
the Treasury Department to be affixed; and the said Continental Bank
Note Company hath caused Alexander C. Wilson, president thereof, to
subscribe his name hereunto, and the seal of said corporation to be
affixed the day and year first above mentioned.

S. P. CHASE,

Secretary of the Treasury. L SEAL *J
ALEX. C. WLLSON, President, [seal.]

Witnesses to the signature of Alexander C. Wilson, president—
Edward P. Moore,

Joseph Andrews.

Bond.

Know all men bj* these presents, that we, the Continental Bank Note
Company, of New York, as principal, and William H. Russell, of the
city of New York, and Homer H. Stuart, of Jamaica, in the county of
Queens, and State of New York, as sureties, are held and firmly bound
unto the United States of America, in the full and just sum of fifty
thousand dollars, for the payment of which, well and truly to be made
to the United States, we bind ourselves, our heirs, executors, administra¬
tors, successors, or assigns, jointly and severally, firmly by these presents,
sealed with our seals and dated this 13th day of July, in the year of our
Lord one thousand eight hundred and sixty-three.

The condition of the above obligation is such, that if the above-bound
Continental Bank Note Company shall well and truly perform and execute
all the covenants contained in a certain contract attached hereto, bearing
date the 13th day of July, A. D. 1863, between Salmon P. Chase, Sec¬
retary of the Treasury, for and in behalf of the United States, of the
first part, and the said Continental Bank Note Company, of the second
part, to furnish all the dies or bed-pieces, rolls, plates, &c., or to hold
and safely keep the same, and to do and perform all the work required
by said contract, in completing the plates for the notes therein contracted
for, then the above obligation to be void; otherwise, to remain in full force
and virtue.

In testimony whereof, the said Continental Bank Note Company hath
caused Alexander C. Wilson, President thereof, to subscribe his name,
and the seal of said corporation to be affixed hereunto; and the said
William II. Russell and Homer H. Stuart have hereunto subscribed their
names and affixed their seals the day first above written.

ALEX. C WILSON, President.
W. H RUSSELL.

HOMER II. STUART.

[seal]

Signed, sealed, and delivered in presence of us—
Edward P.Moore.

Joseph Andrews.

State of New York,

County of New York , City of New York, ss:

W. H. RUSSELL.
HOMER Id. STUART.

Sworn to and subscribed, as above written, this 13th day of July,
A. D. 1863.

LAW. R. BETTS,
District Judge U. S. Court ,

Office of the U. S. District Judge,
Southern District of New York , July 13, A. D. 1863.

I hereby certify that William II. Russell and Homer II Stuart, the
sureties who have signed the foregoing bond, are known to me as residents
of this district and citizens of the United States, and that I believe them
to be amply sufficient security for the amount thereof, and that the bond
is good.

LAW. R. BETTS,

Judge of the United States , fc.

Contract between the American Bank Note Company and the United
States of America.

This contract, made and entered into this twentieth day of July, in the
year of our Lord one thousand eight hundred and sixty-tliree, by and be¬
tween Salmon P. Chase, Secretary of the Treasury, for and in behalf of
the United States of America, of the first part, and the American Bank
Note Company, of the second part, witnesseth:

That the party of the second part, for the consideration hereinafter
mentioned, has agreed, and does hereby covenant and agree, to engrave or
cause to be engraved, in the highest style of art, on suitable steel plates,
certain designs, to be hereinafter enumerated, for twenty, fifty, and one-
hundred dollar notes. The engraved portion of the notes, obverse and
reverse, to be of the uniform size of three by seven inches; and after the
engraving of the same shall have been approved by the party of the first
part, to cause the same to be skilfully and properly transferred to suita¬
ble rolls, and to make therefrom proper plates for printing, in such
quantities as may be ordered by the Secretary of the Treasury.

The designs above alluded to shall be as follows: Eor the obverse of
the twenty dollar ($20) notes there shall be engraved upon the left-hand
portion of the note a vignette representing the “ Battle of Lexington,”

100

and on the opposite or right-hand end of the note a copy of a symbolic
design entitled “Loyalty.” Between these two vignettes shall be engra¬
ved two legends as follows:

In the lower part of the space between the vignettes the following
words : “ The First National Bank of Washington, D. C., will pay the
bearer twenty dollars on demand at their office in the city of Washington,
District of Columbia and suitable blanks shall be left for the date and
for the signatures of the president and cashier of the association.

In the upper right-hand corner of the note the figure 20 is to be en¬
graved, of suitable size, in a white letter with black shade, and a space
to be left for imprinting the Treasury seal upon the right-hand end of the
note. The whole to be surrounded by a suitable border, of alternate leaf
and vine work, and of tablets, in which the figures 20 and the letters
twenty shall be often repeated in different characters.

For the reverse of the twenty dollar ($20) note there shall be engraved in
a central elliptical vignette, two and a half by five (2J by 5) inches, a fac
simile of Chapman’s painting in the Capitol, entitled “ Baptism of Poca¬
hontas.” Above this vignette shall be engraved the legend expressing
the uses of the note, and below it the legend expressing the penalties for
counterfeiting. The words of these legends to be prescribed by the Sec¬
retary of the Treasury.

At each end of the vignette, oval spaces, one by one and a half (1 by 1J)
inch shall be left. For one of these spaces there shall be engraved a suitable
die or bed-plate for surface printing, and a roll made therefrom (after its
approval by the Secretary of the Treasury) of the national shield; and for
the other space the coat of the State from which the note is to be issued.
These dies shall not be transferred to the note plates, but twelve (12)
transfers therefrom shall be made upon separate plates of steel, and these,
with their dies, &c., shall be delivered to the Comptroller of the Currency,
or held subject to his order, as hereinbefore provided.

The words First National Bank shall be engraved above the central vig¬
nette, and the words “ Washington, D. C.,” shall be engraved below it.
The two lines so engraved to be between the vignette and the legends.

The fifty dollar ($50) note to be similar in character to the twenty-
dollar note; but the left-hand vignette on the obverse to be from the design
entited “ Washington Crossing the Delaware,” and the opposite or right-
hand vignette to be engraved from a symbolical design entitled “ Prayer

101

for Victory ,” this day delivered to the manager of the American Bank
Note Company.

The vignette on the obverse to be a fac simile of Weir’s painting in the
Capitol, entitled “Embarkation of the Pilgrims.”

The one-hundred dollar ($100) note to be similar in character to the
others, but the left-hand vignette on the obverse to be from Powell’s
painting of the u Battle of Lake Erie,” from a sketch to be furnished by
the painter, and the opposite or right-hand vignette to be from a symboli¬
cal design entitled “Maintain it,” this day delivered to, the American
Bank Note Company.

All the vignettes on the obverse to occupy the width of the note (the
numerals or counters being cut therein) and as much of the length as
shall be proportionate to the width of the original drawing, giving suita¬
ble room for the legends.

The designs on the reverse of all the notes to have suitable title tablets
engraved in the central lower portion of the vignettes.

Models of the notes made in accordance with this contract to be
submitted to the Secretary of the Treasury, and to be approved by him
before engraving. After being engraved, proofs from all the dies to be
submitted to and approved by the Secretary of the Treasury before they
are hardened or tempered.

The party of the first part, acting in behalf of the United States of
America, covenants and agrees, upon the satisfactory completion of the
aforesaid dies or bed-plates, rolls, and plates, and their surrender to the
Comptroller of the Currency, to pay therefor as follows:

For the bed-plates or dies, rolls, and one transferred plate of the ob¬
verse and reverse of each denomination, the sum of three thousand and
fifty dollars, (3,050.)

It is further understood and agreed that four notes shall be symmetri¬
cally transferred upon the plates, with a space exactly one-eighth (|) of
an inch between them, so that the united width and spaces of the notes
upon the plates shall be twelve and three-eighths (12§) of an inch (United
States standard) from the outward border of the upper note to the out¬
ward border of the lower note.

It is also covenanted and agreed between the parties hereto that the
party of the second part shall execute, with two or more good and sufficient
sureties, a bond to the United States in the sum of fifty thousand dollars,
conditioned for the faithful performance of this contract and the agree¬
ments and covenants herein made by the said party of the second part,
and for the custody and safe-keeping of the work to be executed under
this contract.

102

the work or of the Government, then the said Secretary shall be, and he
is hereby, empowered to cancel this contract, and relet the same.

It is further covenanted and agreed by the parties hereto, that this
contract shall not be assigned, except by consent of the Secretary of the
Treasury; and that any assignment thereof, except as aforesaid, will be
a forfeiture of the same, and shall subject the said party of the second
part and his bondsmen to such damages, to be recovered of them by sjuit
in the name of the United States, as shall have been suffered by the said
party of the first part.

In witness* whereof, the said Salmon P. Chase, Secretary of the
Treasury of the United States, as aforesaid, for and in behalf of the
United States, hath hereunto subscribed his name and caused the seal of
the Treasury Department to be affixed; and the said American Bank
Note Company hath caused George W. Hatch, President thereof, to
subscribe his name hereunto, and the seal of said corporation to be
affixed the day and year first above mentioned.

S. P. CHASE, rsE4Ll

Secretary of the Treasury. L *J
GEO. W. HATCH. [seal.]

President , American Bank Note Company.

Witness as to the signature of George W. Hatch, president—

W. II. Bliss, Secretary.

Bond.

[50-cent revenue stamp.]

Know all men bv these presents, that we, the American Bank Note
Company, of New York, as principal, and Neziah Wright and George
W. Wright of New York, as sureties, are held and firmly bound unto
the United States of America, in the full and just sum of fifty thousand
dollars, for the payment of which, well and truly to be made to the
United States, we bind ourselves, our heirs, executors, administrators,
successors, or assigns, jointly and severally, firmly by these presents,
sealed with our seals and dated this 13th day of July, in the year of our
Lord one thousand eight hundred and sixty-three.

The condition of the above obligation is such, that if the above-bound
American Bank Note Company shall well and truly perform and execute
all the covenants contained in a certain contract attached hereto, bearing
date the 13th day of July, A. D. 1863, between Salmon P. Chase, Sec¬
retary of the Treasury, for and in behalf of the United States, of the
first part, and the said American Bank Note Company, of the second
part, to furnish all the dies or bed-pieces, rolls, plates, &c., or to hold
and safely keep the same, and to do and perform all the work required
by said contract, in completing the plates for the notes therein contracted
for, then the above obligation to be void; otherwise, to remain in full force
and virtue.

In testimony whereof, the said American Bank Note Company hath
caused George W. Hatch, President thereof, to subscribe his name, and

103

the seal of said corporation to be affixed hereunto; and the said Neziali
Wright and George W. Hatch have hereunto subscribed their names and
affixed their seals the day first above written.

GEO. W. HATCH. [seal]
President American Bank Note Co.
GEO. W. HATCH. [seal]

NEZIAII WRIGHT. [seal]

Signed, sealed, and delivered in presence of us—
W. R. Bliss.

Edwin F. Correy.

State oe New York,

County of New York, City of New York, ss:

Personally appeared before me, a notary public for the State of New
York, in and for said city of New York, the said George W. Hatch and
Neziah Wright, who signed the above obligation, and who made solemn
oath that they are worth one hundred thousand dollars over and above all
their legal liabilities.

Sworn to and subscribed as above written this 17th day of August, A.
D. 1863.

EDWARD T. CORREY,

• Notary Public.

[Notarial seal, and 5-cent revenue stamp.]

Office of the United States Assistant Treasurer,
District of New York, August, 17, A. D. 1863.

I hereby certify that the sureties who have signed the foregoing bond
are known to me as residents of the city of New York and citizens of the
United States, and that I believe them to be amply sufficient security for
the amount thereof, and that the bond is good.

JOHN J. CISCO,
Assistant Treasurer United States.

Copy of Proposed System of Checks and Balances for the issue of
Revenue Currency, submitted to the Secretary November, 1862.

Treasury Department,

November 7, 1862.

Sir: I have the honor to submit the following programme of proposed
details for the issue of a Revenue Currency, of which I respectfully ask
the Secretary’s perusal, that its errors may be corrected before going
into operation, and that, when approved, the necessary books and blanks
may be seasonably prepared.

104

My general design is to make each division a check upon the other,
and to balance the whole by a resume before delivery to the Treasurer.
I propose to accomplish this design as follows :

The paper will be made in the basement paper-room, from whence it
will be delivered by a dumb-waiter, in quantities of even thousand sheets,
to the plate-printing room in the attic. Each delivery to be accompanied
by a pass-book, in which will be entered the quantity and sizes of the
sheets delivered. These will be received by the assistant superintendent
of plate-printing, who will count the sheets, and, if found correct, sign
the receipt in the pass-book, returning the book by the dumb waiter °o
the paper-room, after recording the quantity and size received in a book
to be prepared for the purpose, and entitled “Record of Paper Received.”

The person in charge of the paper room will make a daily report to
me, in printed blanks, showing the number and sizes of the sheets on
hand in the morning, number and sizes manufactured during the day,
number and sizes delivered during the day to the plate printer, and the
number and sizes on hand at night.

The assistant superintendent of plate printing will deliver the paper to
the pressmen in quantities of five hundred sheets, charging them to the
pressmen by name, in a book prepared for the purpose with two columns,
ruled for crediting the return of printed sheets, one for “perfect,” the
other for “imperfect sheets. Each pressman to be held strictly account¬
able for the sheets delivered to him, the charge to be cancelled only by
the delivery in kind to the assistant superintendent—not by payment;
i. e., nothing but membrane paper will cancel the charge. All sheets torn,
soiled, or otherwise spoiled, to be returned the same as perfectly printed
ones, but to be entered in the “imperfect” column, and the sum of the
two columns to be the same as the amount charged.

The assistant superintendent will then deliver the perfectly printed
sheets to the person in charge of the drying room, and charge each deliv¬
ery in the “ Drying Receipt Book,” properly ruled with blanks for the
returns. After drying, the dryer will return them to the assistant super¬
intendent in the same quantities as received, who will count and credit
them against the charge, so that each line in the book shall balance itself,
deliveries being on the left and receipts on the right hand of the page.
The assistant superintendent will then deliver the sheets, in parcels of
one thousand each, by the dumb waiter to the messenger of the trimmers’
division, well secured in a galley; sending with the galley a pass-book, in
which is entered the quantity delivered, stating in parallel columns the
number of sheets, the denominations of the Currency, and their amount
in dollars. As often as the “ imperfect” sheets amount to one hundred,
they are to be delivered, with pass-book, by galley, dumb waiter, and
messenger to me, when I am to sign the receipt therefor, returning the
pass-book and galley, count and seal up the sheets, marking the package
with the quantity and date of receipt over my initials and placing them
in the vault, from Avhich they are from time to time to be taken, and
burned under such supervision as the Secretary may direct. The receipts
and burnings to be recorded in a book kept for the purpose, to be entitled

105

“Record of Imperfect Sheets;” and at each burning as many of my
receipts to he cancelled as the burnings embrace. The assistant superin¬
tendent of plate printing to make a daily report to me in printed blanks,
showing the number and size on hand in the morning; number and size
received during the day; number, size, denomination, and amount, in
dollars of the printed sheets on hand at night, as well as the number of
“imperfect” sheets delivered and on hand.

The superintendent of the trimmers’ division will count -and compare
the sheets received from the plate printer, and sign the receipt in the
pass-book, returning the pass-book and galley by messenger and dumb
waiter to the plate-printing room, first recording the quantity and amount
received in a book kept by her for the purpose, to be entitled “Record of
Currency received from the Plate Printer.”

The superintendent of the trimmers division will then deliver the sheets
to the operatives of the trimming machines, in parcels of five hundred
sheets each, to be trimmed on two sides, charging them to the operator in
a book properly prepared for entering the returns. The operator, after
trimming, will return them to the superintendent, who will again count
and credit them to the operator, so that each line in the book shall bal¬
ance itself; noting in parallel columns the perfect returns, and those
which may have been mutilated in the trimming. In like manner they
are again to be given out, recorded and credited on their return for the
trimming, by another machine, of the other two edges. When thus trim¬
med on all sides, they are to be delivered in parcels of five hundred sheets
each, by the superintendents of the trimmers to the superintendent of the
surface printing division, to be receipted for by him in a book prepared
for the purpose, and kept by the superintendent of the trimmers.

The sheets imperfectly cut, or otherwise spoiled in trimming, not to be
separated from the rest, but to be delivered to the surface printer the
same as “perfect” sheets. The sheets injured to be the top sheets of the
pile delivered. From this point forward the “imperfect” sheets are to
be carried on, the same as the “perfect,” until they pass to the separa¬
tor’s division.

The superintendent of the trimmers division to make a daily report to
me, in printed blanks, of the number, denomination, and amount in
dollars of the sheets on hand in the morning; recorded during the day;
delivered that day to the surface printer, and on hand at night.

The superintendent of the surface printing division to record his
receipts, give them out in parcels of five hundred, charge to the opera¬
tor, and credit returns in a properly prepared book, the same as the
superintendent of the trimmers, taking care that the “imperfect” sheets
are not surface printed.

After surface printing, the sheets will require at least three days for
the ink to dry and become hard. For this purpose the superintendent
will, after printing, place the packages (“perfect” and “imperfect”) of
five hundred each between mill boards prepared for the purpose, ticket
each package with his name, the date, and quantity, and lock them up in
the iron drying cupboards of the vault, keeping the keys of the cup-

106

boards, (duplicates of which shall be kept by the Treasurer of the United
States,) and being held responsible for the currency while it is thero
drying; after drying, he will deliver the packages of five hundred to the
superintendent of the separators division, placing on the top of the pile
the imperfect sheets received from the trimmers, with those which may
have been in any way spoiled in his division, and taking the receipt of
the superintendent of the separators, in a book similar to the trimmers,
showing, in parallel columns, the “perfect” and “imperfect.” He will
also make daily reports to me in printed blanks of his day’s doings, sim¬
ilar to the other divisions, with an additional line showing quantity, de¬
nominations, and amount in the vault cupboards.

The superintendent of the separating division will pursue the same
system of recording, receipting and charging to operatives in prepared
books, as the previous divisions, except that she will not give out imper¬
fect sheets for separating. She will keep upon her table, day by day,
one package of five hundred sheets as a “stock package” of each denom¬
ination, to and from which she will exchange imperfect sheets for perfect
ones, so as to give to her operator five hundred perfect sheets at each
delivery. If the operator mutilates or otherwise spoils a sheet in sepa¬
rating, she must immediately return it to the superintendent to be
exchanged for a perfect sheet from.the “ stock package.” (This is neces¬
sary to ensure decimal delivery to the Treasurer, as well as making a
more ready and simple check upon the packers.) When the stock pack¬
age shall have been all converted into imperfect sheets by such exchanges,
they are to be delivered to me, and be by me counted and receipted for ;
recorded in the “Record of Imperfect Sheets,” sealed up, marked, and
placed in the vault for future burning.

As the separated currency comes from the machines it is to be deliv¬
ered by messenger and pass-book to the superintendent of the packing
division, who will receipt therefor upon the pass-book, and record them
in her book of Receipts.

Ike superintendent of the separators division will make daily reports to
me in printed blanks, the same as the other divisions, with additional col¬
umns showing the imperfect sheets received, made, delivered, and on hand.

The superintendent of the packers, after recording her receipts, will
cause them to be packed as follows:

The 5 cents, 10 cents, and 25 cents to be put up in packages of $10
each, secured by a paper strap maked $10, and the 50 cents in packages
of $20 each, secured by a paper strap marked $20. Five of each of these
packets, aggregating $50, to be banded together by a strap marked $250.
r our of these $250 packets to be placed in neat paper boxes, to be pre-
pared lor the purpose, (measuring 6 inches long, 5J inches wide, and 31-
inches high,) and labelled on the top thus:

1,000 Dollars United States Revenue Currency.

$200 in 5 cents,

$200 in 10 cents,

$200 in 25 cents,

$400 in 50 cents.

107

and in this condition to be delivered to the United States Treasurer in
locked-up wooden boxes, by a messenger.

The Treasurer, or bis delegated clerk, to receipt for each delivery, for
so many boxes as may be delivered “marked to contain” one thousand
dollars each. On the morning of each day the clerk shall, if found cor¬
rect, write across the previous day’s receipts, the words “ correct in count,”
and sign it with his name. Upon the presentation of this certified receipt
the Treasurer shall afiix his own signature in the “Final Receipt Book”
to a receipt for like amount. The Treasurer, after ascertaining the cor¬
rectness of each box, shall secure the cover and box together by a band
of red taffeta passing in two directions around the box, crossed and tied
at the centre of the top, where he shall affix his official seal, so that the
box cannot be opened without breaking the seal or cutting the band.
When thus prepared they are ready for delivery to the Assistant Treas¬
urers and Designated Depositaries.

The superintendent of the packing division to make daily report to me
in printed blanks, similar to other divisions.

The superintendent of each division to be held accountable to the De¬
partment for its receipts, and the operators in their turn to be held ac¬
countable to the superintendent for deliveries until the returns are fully
credited. All losses, after leaving the plate-printing room, invariably,
and against all excuses, apologies, or reasons, to be deducted from the pay
of the party in whose custody the sheets may have been when the counting
first discloses the loss.

The superintendent of each division, at the close of each day’s work,
shall properly secure the sheets on hand in gallies, (except such of the
surface printing as may be in vault or drying cupboards,) ticket them with
the amount and name of the division, and deliver them to the proper per¬
son, to be placed in the vault for safe-keeping during the night.

The inner door of the vault to be locked and unlocked by the Treasurer,
(or a clerk delegated by him for the purpose,) and the outer door by
myself.

It shall be my duty, in addition to the general supervision of all the
divisions, to record daily, in a book prepared for the purpose, a tabulated
resume of all the reports made to me, and make a comprehensive report
thereof in a printed blank, to be placed each morning on the Secretary’s
table.

This record book to be so kept as not only to clearly show each day’s
operations, but to be susceptible of a balance at any time by an examining
officer.

The Secretary to detail a proper person to make an examination and
balance, (either at regular or irregular periods, as the Secretary may
deem to be the safest check,) who shall, upon such examinations, certify
upon the book that he has examined and compared the receipts and deliv-
. eries with the original reports, and finds that the deliveries and marked
packages of imperfect sheets, together with the amount reported on hand,
by the various divisions, balances the membrane paper manufactured up
to the date of the examination.

108

Such certificate to be final proof of correctness, and relieve me of
responsibility up to that point.

The Secretary to designate the persons to act as superintendents of the
different divisions, who are to be held accountable for the Currency while
in their possession.

Mr. Charles Neale having been already designated by the Secretary as
the superintendent of the “plate-printing division” and entered upon its
preliminary duties, his letter of appointment, dated at the time his ser¬
vices commenced, is herewith submitted for the Secretary’s signature.

I have the honor to be, very respectfully, your obedient servant,

S. M. CLARK,

Chief Clerk in charge.

Hon. S. P. Chase,

Secretary of the Treasury.

Report upon the manufacture of paper in the Treasury Department.

Treasury Department,

Office of Construction,

July 7, 1862.

Sir : In compliance with your instructions I have the honor to make
the following estimate of the probable cost of the machinery for manu¬
facturing Note and Bond paper in the Treasury Building, viz:

One 60-inch Fourdrinier machine, about. 05,000

One 40-horse steam engine, about. 2,000

Three beating engines, say $500 each, about. 1,500

One 8-horse steam engine, about. 500

One flue boiler for both engines. 2,500

$11,500

The necessary cisterns, pumps, &c., with other fixtures, could be made
by the employes upon the Extension, and blank books, &c., by the
Public Printer.

The water of the Potomac is too impure for the purpose, but a neces¬
sary supply could be had with the control of the I street spring, which
now delivers in the Treasury court-yard.

The space I should devote to the purpose would be the two long (south)
rooms in the cellar of the west wing, and one (east) room over them in
the basement. From these I would construct an exterior elevator (acces¬
sible from the interior) on the court-yard side to elevate the paper to the
drying lofts. The drying lofts I would provide for by making a full
story (iron exterior) of the east half of the attic of the west wing, which

109

would give ample room without marring the architectural beauty of the
building. Plans and specifications for this work are prepared and ready
for advertisement.

The paper could best be made in one of two ways: 1st. To bargain
with a competent manufacturer to purchase the stock and make the paper
in the building with the Government machinery at so much per one
thousand sheets; or 2d. To hire a similar expert to make the paper at
an annual salary, the Department furnishing stock and employes as well
as machinery. The latter course I should decidedly recommend as the
better means of procuring the best quality of paper at a minimum cost,
and the most within the Secretary’s control.

I recommend the manufacture of paper in the building in preference
to contract outside, because I believe it would give greater security
against counterfeiting and loss, and ensure a better and more uniform
paper at a lower cost. I am satisfied it could be made as low as $10 per
thousand, and am led to believe it could be produced, of the very best
quality, for a less sum. That we are liable to loss, as the Secretary
suggests, from dishonest employes, I do not think sound argument against
it. I do not see that such objection obtains in coinage. We make our
own coin under a like risk; and I believe the present system now in
operation for Treasury Notes, of rigid accountability, with such modifi¬
cations as experience suggests, will be a close approximation to safety.

If the Department should make its own stamps, (which I recommend,)
to be used in carrying into effect some of the provisions of the Tax Bill,
it would be an additional incentive for making the paper in the building,
as the sheets made, not of the required thickness or perfection for Notes
and Bonds, could be worked up in the stamp room, adding to the security
of the stamps issued, while it lessened their cost. In paper mills, making
paper with a distinctive mark for Government, all paper varying from
the standard (and more or less will necessarily so vary) would go back
into the pulp for remanufacture.

The same reasons that make it wise for the Department to engrave its
own issue of notes, viz: greater security with lessened cost, apply with
equal force to stamps so far as the Government is concerned. The
people,as a whole, will not feel great interest in the genuineness of stamps,
although the rivalry of trade will measurably operate as a detective force.

As I believe no one now in the Department will live to see the end of
paper issues by the Government, (especially if the Secretary’s compre¬
hensive, far-reaching, and wise project be adopted of furnishing local
banks with a “currency” or “circulation,” upon the deposit of United
States six per cents,) so I believe the manufacturing of the issues in the
building will become a fixed policy.

Whether it will be sooner or later will depend on the Secretary’s judg¬
ment as to its feasibility and propriety. It may be that the wisdom of
such policy must first be certified by losses to the people and the Govern¬
ment ; but the experience of other nations has proved, what ours will
prove, if the present system be continued. The Bank of England pro¬
tects the people by redeeming counterfeits, and, relying on its own manu-

110

facture of paper, protects itself by a record of each note issued and re¬
deemed, with an efficient detective force of its own, aided by a rigid and
summary execution of the laws. No one in England questions the
authenticity of a note offered; it passes from hand to hand by tale as a
matter of course. The confidence in genuine and redemption is alike
universal.

I respectfully apprise the Secretary that all preliminary details are
ready for his decision. No expense or obligations have yet been incurred
for making paper, but I have reached a point where they must be in¬
curred, if any thing more is to be done; and every day that now elapses
will only add a cost for the circulation that is to be issued, (on an expect¬
ed withdrawal,) if the Treasury ultimately manufactures its own issues.

I have conferred with none of the makers of the machinery above
estimated, (not feeling warranted yet to do so,) so that I cannot positively
aver that none of it is to be bought ready made, but it is all of a charac¬
ter not ordinarily kept on hand for sale. It is always made to order.
Some second hand or rejected machinery may be had. Under the most
favorable circumstances it could not be made in less than sixty days, and
probably ninety days would be consumed in making and setting up.

I have also the honor to report that the time has arrived when it is
necessary to give the orders for the required machinery for engraving and
printing, if the work is to be done in the Department. My estimate is
as follows:

(Transfer presses will first be required. They cost from $1,000 to
$1,500 each. If stamps, sa well as notes, are engraved, two transfer presses
will be necessary. I assume that stamps will be engraved, and therefore
estimate for two, and take highest cost.)

Say: Two transfer presses, at $1,500 each. $3,000

Ten numbering presses, at $200 each. 2,000

Sealing presses, on hand.

100 printing presses, outside cost, say $150 each. 15,000

$20,000

Blankets, ink, &c., as circumstances dictate.

The necessary fixtures, &c., can be made by the workmen on the Exten¬
sion, and blank books, &c., by the Public Printer.

I purposely omit any estimate for a Geometric or Cycloidal Lathe, as
I do not think such work affords sufficient security to justify the cost.

At least six first class artists would be required for etching, for the
figures and portraits, for lettering, and for transferring. Each printing
press would require a male expert and female attendant, and the number¬
ing and sealing presses would each require an operator.

Each branch of the work would require a superintendent, some, in
addition, a foreman, all to be under one general head. Eor the accom¬
modation I propose an additional (iron) story to the central wing. Plans

Ill

and specifications therefor are prepared and ready for advertisement, and
it could be made ready, if now commenced, as soon as the paper could
be made.

All that I have yet done for this branch of the work (other than my
personal service) has been to get the necessary photographs of paintings
for the four lowest denominations; hire an etcher at a (temporary) com¬
pensation of $1,600 per annum, (to be hereafter advanced if he proves
sufficiently expert,) and to buy a few pieces of steel for bed-plates, upon
the preparation of which the etcher is now engaged. I have ordered the
slate for the proposed new story; if it should not be built it would all be
required on the north wing hereafter. The experiments in ink, (for dry
printing,) which were suspended during Professor Schaffer’s absence, are
now progressing, and I gain confidence in the result at every step.

The orders for the machinery (except sealing presses, for the “small
note organization,” under the project submitted for the Secretary’s con¬
sideration on the 10th of April, and adopted on the 10th of May) are
all issued, and the work well advanced. I delayed ordering the sealing
presses, thinking that engraving in the Treasury might possibly super¬
cede them. Upon the Secretary’s suggestion I have examined the law,
and find that sealing was obligatory on the former issue, and if it so
remains on the new issue (I have not yet seen the new law) I will at once
order the presses. The massive blocks of granite, and the angle iron for
the new vault, were duly ordered, and the cargo of granite has arrived,
but I have yet no wharf whereon to land them. The wharves are all in
the possession of the military authorities. The preparation for issuing
small notes will all be complete before the bills are ready.

I have the honor to be, very respectfully, &c.,

S. M. CLARK,

TT 0 _ Acting Engineer in Charqe.

Hon. S. P. Chase,

Secretary of the Treasury.

Copy of contract with Stuart Glwynn for Membrane Paper.

This agreement, made this 13th day of October A. D. 1862, by and
between S. P. Chase, Secretary of the Treasury, for and in behalf of the
United State of America, of the first part, and Stuart Gwynn, of the city
of New York, of the second part, witnesseth:

That whereas, the said Stuart Gwynn has discovered and invented a
new process for the manufacture of paper, and which it is deemed advis¬
able that the Treasury Department should, for the present, possess the
exclusive right to manufacture and use for its issue of Stamps, Notes, &c.

Now, therefore, it is mutually agreed by and between the parties hereto,'
that the said Stuart Gwynn, for the consideration hereinafter named!

112

shall convey, and he does hereby convey, to the Treasury Department,
the exclusive right to manufacture and use, or control the manufacture
and use of, the said “membrane paper,” so long as the Secretary of the
Treasury may desire; and the said Stuart Gwynn hereby covenants and
agrees for himself, his heirs, administrators, and assigns, that he will not,
so long as this agreement remains in force, make or sell any “ vegetable
membrane,” or any like article, or any matei’ial produced by like chemi¬
cal agencies and mechanical appliances, for, or to, any person or persons,
corporations or associations, in this or any other country, nor impart or
divulge the secret or process of its manufacture to any person or persons
whatever, except those immediately engaged in making it for the Depart¬
ment, to whom such knowledge must be necessary for its production.
And the said Stuart Gwynn further covenants and agrees, for himself,
his heirs, administrators, and assigns, that he will manufacture the said
vegetable membrane, for the Department’s use, in the Treasury Building,
in such quantities and of such size and quality as may be directed, in
sheets not exceeding fourteen inches in width and twenty-one inches in
length, and not weighing more than twenty pounds to one thousand sheets,
and deliver the same in such quantities and in such manner and to such
parties as may be directed, at the rate of twelve dollars ($12) per thousand
sheets, while the delivery is not more than 16,000 sheets per day; and
in the event of a larger number of sheets than 16,000 per day being
found necessary or desirable, he shall furnish such larger number at fifty
cents (50 cents) per thousand sheets less for each additional 8,000 sheets
ordered, until the reduction of price shall have reached a minimum of ten
dollars ($10) per thousand sheets; that is, the price of the membrane
shall be as follows:

For 16,000 sheets per day, $12 00 per thousand.

24,000 “ “ ' 11 60 « for the third 8,000.

32,000 “ “ 11 00 “ for the fourth 8,000.

40,000 “ “ 10 50 “ for the fifth 8,000.

48,000 “ “ 10 00 “ for the sixth 8,000.

And for all deliveries over 48,000 per day, $10 per thousand for each
additional thousand sheets.

The party of the second part further agrees that he will superintend
the construction of the necessary machinery for the manufacture of the
vegetable membrane, and have the same placed in working order in a
room to be prepared by the Department for the purpose, in the basement
of the west wing of the Treasury Extension, within thirty days from the
date hereof, or as soon thereafter as it is mechanically possible. Said
machinery to be constructed and set up at the cost of the Department, but
not to cost more than $2,500, exclusive of motive power, for each machine
capable of producing 8,000 sheets in ten working hours. If each machine
should prove to cost more than $2,500, then such excess of cost over
$2,500 shall be chargeable to the said party of the second part, and be
deducted from the monthly payments hereinafter provided to be made to
the said Gwynn, (such deduction not to be more than twenty-five per
cent, from any one payment) until the whole of such excess over $2,500

113

is reimbursed to the Department. It being understood that in the
contingency hereinafter provided for, of an abandonment of the use of
the membrane, and the repurchase by the said Gwynn of the machinery
at a valuation, such excess of cost over $2,500, and so much of said
machinery as the excess of cost over $2,500 shall equitably represent,
shall not enter into the computation of the valuation, but shall be deemed
and taken to be already the property of the said Gwynn; but should no
such contingency arise, and the Department continue permanently to
use the membrane, then the entire machinery shall be the sole and exclu¬
sive property of the Government.

It is further agreed and understood that the party of the first part
shall provide motive power in the shape of a steam engine and boiler of
20-horse power, of suitable construction, with proper cut-off and gov¬
ernor, and furnish the fuel and an engineer therefor, to run such hours
as the exigencies of the public service shall make necessary.

It is further agreed and understood that a secret mark shall be placed
in the web of the paper, so that one copy, or impression thereof, shall be
upon each note or stamp issued, of such size and device as may be
directed by the Secretary of the Treasury, and that the paper shall be
tinted of such color as may be desired, without extra charge for such
mark and tint, provided the Department furnished all the means and
appliances for making such private mark and such tints at its own proper
cost, without charge or expense to the said party of the second part.

The party of the second part further agrees to furnish, at his own
proper cost and charge, all the materials, chemicals, and labor for the
proper manufacture of the vegetable membrane, and all the necessary
operatives, who shall be hired and paid by him, and who shall be subject
to his exclusive control. And, inasmuch as he deems that the possession
of the secret of its manufacture will be of great value to him if this
contract shall be abrogated, the room wherein the web is converted to a
vegetable membrane shall be at all times under his exclusive control,
subject only to the general directions of the officer in charge of the
currency, it being understood, however, that if at any time this contract
shall be made perpetual, then the Secretary of the Treasury shall have
the power, if he so elects, to assume the entire control of the operatives
and of the machinery, and of the room occupied in the conversion of
the web.

The party of the first part, acting for and in hehalf of the United
States, hereby covenants and agrees, well and truly to pay to the party
of the second part for the vegetable membrane delivered under this
agreement, at the rate of twelve ($12) dollars per one thousand sheets,
while the delivery is sixteen thousand sheets per day, or less, and pro
rata less price, according to quantity, as hereinbefore provided for. And
it is mutually agreed and understood by and between the parties hereto,
that such payment shall be a full and complete consideration for the
exclusive use, ownership, and control of the discovery and invention of
the said Gwynn, as well as for materials and labor employed in the
manufacturing of the membrane, and that no other consideration of any

114

kind whatever shall be paid for the monopoly or the manufacture; the
party of the second part hereby unconditionally agreeing to accept the
prospect of profit he expects to make at the above-named prices, as a full
and complete indemnification for the surrender of all the rights which
may accrue to him as the 'inventor and discoverer of the process, appa¬
ratus, and machinery used in the process and manufacture of the vegeta¬
ble membrane. It is further agreed by and between the parties hereto,
that the party of the first part may, at any time that he may so elect,
abrogate this agreement, and annul all its obligations for receiving and
paying for the said membrane, upon giving six days notice to the party
of the second part, which notice shall take date from the time it is deliv¬
ered in writing to any party in charge of the working machinery, whether
the said Gwynn be then actually present or not.

In the event of such cancelling of this agreement, then the entire and
exclusive right to manufacture, vend, or use this vegetable membrane
shall return and be again vested in the said Gwynn, as fully and com¬
pletely as if this contract had not been entered into, and the Treasury
Department shall retain no right or interest whatever therein, and shall
not manufacture or cause to be manufactured, nor use any of the vegeta¬
ble membrane, except such as shall be manufactured by said Gwynn, or
with his consent, or any like article or material produced by like chemi¬
cal agency and mechanical appliance for any person or purpose what
ever; and the said Gwynn, in the event of such cancelling of this agree
ment, hereby agrees to purchase and receive such machinery as maythen
be in use for the manufacture, with the contingent exception hereinbefore
named, at a valuation by three disinterested parties, to be mutually
chosen by the Secretary of the Treasury and the said Stuart Gwynn,
provided they can agree upon the basis to make such valuation, and, if
not, then one of such persons to be chosen by the Secretary, one by said
Gwynn, and the other by the two thus chosen. It is further aoreed, that
payment shall be made monthly, under this contract, for as many sheets
of the membrane as may have been delivered during the month, and that
the receipt of the superintendent of the printing department shall be
evidence of delivery of as many sheets as such receipt may acknowledge.

In witness hereof the said S. P. Chase, Secretary of the Treasury,
acting for and in behalf of the United States, and the said Stuart
Gwynn, acting for himself, his heirs, administrators, and assigns, have
hereunto, interchangeably, set their hands and seals, in duplicate, on
tbs the 13th day of October, 1862.

S. P. CHASE,
Secretary of the Treasury.
STUART GWYNN,
of New York.

Witnesses to the signature of Stuart Gwynn—

S Hooper,

S. M. Clark.

[seal.]

115

Copy of a letter to the Hon. Mr. Garfield , Chairman of the Special
Committee of Congress.

Treasury Department,

National Currency Bureau,

First Division , June 20, 1864.

Sir : I am informed that it is the intention of the special committee of
Congress, of which you are chairman, to close its labors, so far as I am
concerned, without further examination of witnesses. I hope this is not
so; but if it be, I must, without intending any disrespect to the committee,
most earnestly remonstrate against any such action.

I have been charged, by name, upon the floor of Congress, by a mem¬
ber of the House, with official dishonesty and gross immorality.

When this member made these charges he stated, in his place before
the House, as reported in the Daily Globe, that he could and would prove
them if he was allowed a committee of investigation.

These charges and this statement have been copied, and enlarged, and
circulated with opprobrious comments, in sensation articles, from Maine
to Louisiana. Congress promptly gave my accuser this committee, with
the most enlarged power. He is a member of it, and has assisted at its
deliberations and examinations as public prosecutor. I have been before
it upon subpoena three times, being told the last time that I should be
again called, and am as yet unadvised by the committee of a single speci¬
fication, or, indeed, of a single charge made against me. They have ques¬
tioned me on various matters. To all questions, the committee will bear
witness, that, without knowing, or caring to know, the end to which their
inquiries tended, I have evaded nothing, suggested nothing, withheld
nothing, but have endeavored to make my answers fully responsive to the
questions, patiently waiting the pleasure of the committee to advise me of
the charges and the specifications of charge, and of the proof which has
been offered in support of them by the prosecutor.

For the committee now to close its labors, after many weeks’ examina¬
tion of witnesses furnished by my accuser, without divulging to me the
charges and the nature and kind of proof produced, and without giving
me an opportunity to attempt distinct refutation, or to name witnesses
for the committee’s examination, would, irrespective of this committee’s
conclusions, I am constrained to say, in my humble judgment, be unjust
to me and oppressive.

It may, indeed, appear to the committee that I should confide in their
just judgment; that, being disinterested and impartial judges, if they
perceive no ground for further examination, I should be content with the
record.

I am well advised of the justice and integrity of this committee. I
expect nothing from them but a fair and impartial decision upon the evi-
dence before them. But, because I am satisfied with my tribunal, it by
no means follows that I may not desire to make out my case. ?

116

The accused in court may place the most implicit confidence in the
judge upon the bench, but he -will none the less exercise his lawful right
to examine his accusers or their witnesses as to the real truth of matters
of which he is presumed to know everything, and his judge is presumed
to know nothing. How otherwise can full and exact justice to all be
done by the judge?

No man who properly values himself, when his character is falsely as¬
sailed by grave charges, will accept a non-suit on technicalities or upon
the supposed untruth of the accusations. He will claim the right to prove
their untruth—it may be from the mouths of his accusers—and thus to
fully vindicate himself by the record. That simple right I now respect¬
fully claim of this committee.

It is not enough that my accuser, after long searching of the dregs and
scum of Washington life for pliant witnesses by his tools, has signally
failed to produce any proof satisfactory to the committee of his allega¬
tions. This is not enough. I desire opportunity to disprove them, so
thoroughly, that he will not again be permitted to make use of his high
prerogative, as a member of Congress and of its committee, to vilify, for
party purposes, or for any purpose, the good name of even so humble a
citizen as myself. I desire to avail myself of this the only lawful oppor¬
tunity which the sacredness of debate upon the floor of theHouse will
admit, to nail these slanders to the counter, and brand their utterance as
it deserves.

The imperative necessity for claiming and exercising this right is
forcibly presented to me, when, as I am credibly informed to-day, an
officer of a New York Bank Note Company, bearing himself no enviable
reputation, has been in constant daily intercourse with my accuser, run¬
ning to and fro between him and prejudiced or suborned officers and em¬
ployes in this Department, and to the reporters of the sensation press.
It is publicly alleged that he, with other agents of the Bank Note Com¬
panies, from their knowledge as experts, prompted my accuser to prepare
questions to their co-laborers as witnesses, whose answers, standing unex¬
plained and unquestioned upon the record, may be prejudicial to the
method of business in the Treasury; for, you are well aware, that the
system as well as myself is on trial before you.

Thus the prosecutor may avail himself of the aid of experts to spread
upon the record such shaping of established facts as may tend to sustain
his accusations, while the unprejudiced portion of the committee, who are
only desirous to elucidate truth, have not the aid of experts, and are left
to rely solely upon their professional or personal acumen to strip the false
varnish from the real fact. It is my duty, as it is my right, to examine
and scrutinize this prepared expert testimony by cross-examining the wit¬
nesses, or at least by suggesting questions for such cross-examination, to
the end that the exact and undistorted facts may be upon your record.

I have thus far spoken of my rights as a citizen. I now speak as an
officer of the Government. I am charged with a grave and responsible
trust by the honorable Secretary of the Treasury, perhaps the most grave
and responsible ever entrusted to a single subordinate officer in the finan-

117

cial history of our country. Upon the faithful discharge of this trust
rests the trustworthiness of the currency and securities of the Govern¬
ment, and through them, the credit of the nation in all countries where
its securities are negotiated.

If belief in false issues of fabulous amounts of the country’s liabilities
obtains with the public, the commercial value of the true issue will be les¬
sened and confidence in the national securities weakened. I do not say
that this is the aim and intent of my accusers and prosecutor, but I do
most emphatically say, and desire the committee to be fully impressed
with the fact, that this will be the inevitable effect of the accusations,
unless these charges of false issue be met and refuted in the broadest pos¬
sible manner by the most comprehensive and indisputable evidence of
their utter falsity. It is not, therefore, for personal reasons alone that I
entreat the committee that I may be allowed to hear and refute these
charges. The people who have entrusted their vast revenues to the
Treasury Department—the Secretary of the Treasury, who has accepted
the trust—the Department itself—nay, the very head of the nation and all
his constitutional advisers, have a vital interest in their truth or falsity.
They are grave accusations against the integrity of a subordinate officer
charged with the details of a most important portion of this vast trust,
proclaimed on the floor of Congress by a member who asserts that he
truly represents a large financial constituency. The people will judge
for themselves of the truth or falsity of these charges by the recorded
evidence; and if that record be not a broad and full refutation of the
charges made, or implied, their judgment may or may not accord with the
judgment of the committee. Therefore do I claim, as a broad public
right, that every charge and every specification of charge, no matter how
ill founded they may seem to the committee, shall be subjected to the
most thorough, searching, and complete investigation.

If, as has been publicly asserted, I am charged before this committee
with a fraudulent or overissue of any of the nation’s liabilities, then I
respectfully demand from this committee that the kind of security thus
charged to be overissued, or issued fraudulently, be distinctly stated;
that the accounts of its manufacture and issue in this Department be
thoroughly, carefully, and completely examined, by the means already at
the disposal of the committee, and such other means as they may deem
useful or desirable; that these accounts be carefully balanced, and that
balance made of record, to the end that the public may know if such mo¬
mentous charges be true or false.

I am told that certain parties, even in the Treasury, are communicating
distorted reports of occurrences in this Division to my accuser. This
may be true or not true, but I have reason to know that information of
events transpiring here is promulgated through my accuser, with tele¬
graphic directness, in the committee-room with such comments as he sees
fit to make. I ask, therefore, to be heard in reply to such statements,
evoked by such witnesses, in attempted prejudice of this Department.

If, as I am told, the fact of one unf inshed impression of notes having
been stolen from the drying-room in the Treasury building has been placed

118

upon your record discreditably to the Treasury system, then I respect¬
fully remonstrate against any incomplete record of this occurrence being
made. I desire opportunity to prove that the fact of this abstraction of
one sheet from the fifty thousand sheets printed on that day was known
to the Treasury officers, through the system of checks and balances, and
made matter of record on the day of its occurrence; that the guilty party
was suspected and watched; that her first utterance of a note on the next
day was known, the note so uttered recovered, and the woman identified
and arraigned for the theft. I desire also the opportunity to prove, in
defence of the Treasury system as against a system sought to be forced
to its use, that the fact of false utterrance of notes when prepared, as
formerly, by the Bank Note Companies was no very rare occurrence,
and one which the officers apparently neither knew nor suspected until
the notes had been in circulation, returned to the Treasury for redemption,
and the Companies notified thereof. Or, if they did know it, the false
utterance was connived at; or, at the best, that if it was known, the
knowledge was suppressed. I desire opportunity to prove, also, that even
now, notes which have been in circulation are presented for redemption
which bear upon their face undeniable proof of having been issued from
these New York establishments without passing through the office of the
Treasurer of the United States; and that such notes so presented are
redeemed and paid by these Companies upon the Treasurer’s demand,
thus tacitly proving the false utterance. These are all facts of record in
the Treasury Department. Let them appear upon your record also, and
thus spread the whole truth before the people.

I am advised by witnesses who have testified before you that my
accuser has imputed fraud to me in connexion with a contract for the
Charleston custom-house, made in the time of Secretary Corwin, many
years before I entered the Department; and I know from the Daily
Globe that he has caused to be read from the Speaker’s desk, as part of
his speech, the report of a committee of a former Congress charging me
with such fraud in reference to that contract. I know also that when I
was before your committee he made inquiries of me in reference to that
report. In my answer I took occasion to state that I had replied to that
committee’s most extraordinary and most false report, in a letter to the
honorable Secretary of the Treasury. This I stated in the expecta¬
tion that the committee would call for a copy of that letter from the
files of this Department, and thus put my defence upon the record. The
committee in its wisdom have seen fit to omit making such call. I now
respectfully ask that such call be made, or that I be heard in reply to
that report, formally made, as it has been, a part of the present attack
upon me.

If, as I infer from report, the charges of personal immorality consist
of the coerced and suborned affidavits filed with the Solicitor of the
Treasury by the infamous hireling of men reputed to be better than him¬
self, but whose love of greed blunts their moral sense, then I desire to
say to this committee, most distinctly, that I am prepared to prove
affirmatively, by overwhelming and irrefutable testimony, the total

119

untruth of all the allegations they contain. I am prepared, with over¬
whelming refutation and contradiction, to disprove all charges against the
good conduct of the bureau of which I have charge; and prepared to
prove, by the sworn testimony of those who know whereof they testify,
its eminent good order and decorum.

If, as I have been told, the president of a New York Bank Note Com¬
pany has been permitted to put upon your record a statement formerly
filed in the Treasury Department by him, and subsequently withdrawn
by him, to the effect that I was once arrested in a house of ill-fame in the
city of New York, and imprisoned, and that the fact of the arrest and
imprisonment was published in the newspapers of the day, then I demand
that he shall be called upon to produce proof of that arrest—a matter
easily proven, if true—and that he shall be called upon to produce the
papers or paper in which such arrest was published, or certified copies
from their files—a kind of proof easily adduced if it ever existed.

If he fails to produce these proofs, I claim not only that his allegations
are false, but that they are wilfully and maliciously false, for these are
charges that cannot be mistakes. They allege distinct facts, as of record.
Let the record be shown, and let both my accuser and myself abide the
result. Meanwhile I distinctly avow to the committee that no such
arrest or imprisonment ever took place: that no allegation of such arrest
or imprisonment was ever printed in any newspaper; that I was never
arrested for any cause in my life; that I never, for any cause, was
imprisoned an hour in my life; and I challenge proof to the contrary.
Any proof thereof failing, this Bank Note Company’s president must
stand branded by your record as a perjured slanderer, and it will be my
duty hereafter to hold him and those he represents to their lawful
responsibility.

If there be unrefuted charges before the committee, other than those I
have enumerated, and I have heard of none, prejudicial to my manage¬
ment of this bureau, or to strict propriety in that management, or any¬
thing in any way derogatory to my character, either financial or moral,
I respectfully ask to be informed of them, and of their specifications,
and pledge myself to their full and complete refutation. In the event of
failing so to refute them, I consent to be disgraced by your record before
my friends and the public.

All I ask is opportunity of disproof.

This, I respectfully submit, is my manifest right; and therefore do I
most earnestly remonstrate against this committee now closing its delib¬
erations before my proof is presented, (even though the committee, as the
case stands, should hold me guiltless,) and I desire this, my protest to be
placed upon your record.

Very respectfully,

S. M. CLARK,

Chief of First Division , National Currency Bureau.
Hon. James A. Garfield, M. C.,

Chairman of Special Committee , £e., fc.

120

Letter to the Eon. Secretary of the Treasury in reply to the charges of a
Special Committee of Congress, of which the Eon. 3Ir. Sargeant was
Chairman.

Treasury Department,

Office of Construction,

August 15, 1862.

Sir : I accordance with your order, orally delivery by your private
secretary, on the 23d ultimo, I surrendered the charge of this Bureau to
Mr. Rogers, and resumed my duties as chief clerk.

As this order was issued immediately after the publication of an ex
parte report, by a. Congressional Committee, condemning the manner in
which I had discharged my duty as Chief of the Bureau, your action is
naturally construed by my friends, and so much of the public as take
any interest in the matter, as an endorsement of that committee’s report.
I cannot so accept it, although the change was ordered without any pre¬
vious intimation from you that you had it in contemplation, because, if
you believed the committee s report, you would not, I think, now employ
me in any capacity. But I none the less rest under the imputation, both
in and out of the Department.

As it is known in the Department that you had not asked me for a de¬
fence against the committee’s charges, or sought to know if I had anythin*
to say in reference to it, I respectfully desire, with your permission, to
place upon the files a reply to some of their accusations.

But, first, I desire to apprise you of the circumstances which inaugu¬
rated and attended the action of the committee, and of the character of
its advisers, and the cause of the action of those advisers.

reference to a letter now on file from Mr. Latham, dated June 28,
lbb_, it will be found that he, by his own confession, “ to some extent
stimulated the investigation;” and it is generally alleged that the resolu¬
tion upon which the Committee have acted was introduced at the instiga¬
tion of certain contractors, who were exasperated by my reporting adverse*
y upon claims presented by them to the Department. These claims I be¬
lieved as did my predecessors, Major Bowman and Captain Franklin,
were baseless or fraudulent. Foremost among these contractors were
ilr. Latham, contractor for the Buffalo and Oswego custom-houses, and
rn Uuske y> con * ;i ' ac tor for the Galveston custom-house,
lhe first of these, Mr. Latham, in the letter above alluded to, states,
that ‘ 1 make no secret of my personal hostility to him,” and that “ very
naturally a bitter feeling has been engendered between us,” and, in effect,
alleges that my reports on his claim have been, and will be, influenced by
personal vindictiveness. Mr. Latham mistakes; I never saw or heard of
him until he was before the Department as a claimant, and since he has
been before it I have seen nothing in him worthy either of my anger or
respect. A bitter feeling may be “natural” to him, but it is not to me,
and it it exists he enjoys a monopoly of it. My hostility is to the claim—

121

not to the man. If I know myself, I was governed in my reports by a
simple sense of duty—not by malice. There is no person, place, power,
or pay that can force me into rendering a report against my sincere con¬
victions of right on any matter. My record for six years past exists in
the Department; I feel that I ought to be judged by that, rather than by
the vindictive misrepresentations of a disappointed claimant.

Mr. Latham’s contracts aggregated in the sum of one hundred and
fifty-eight thousand six hundred dollars, ($158,600.) Upon the report
of Major Bowman, with my knowledge and concurrence as chief clerk, he
had been paid this amount by Mr. Guthrie, with forty-one thousand two
hundred and forty-five dollars ($41,245) more for extras, including an
enlargement of one of the buildings.

Thus he was paid nearly two hundred thousand dollars in all, and he
now claims over two hundred and fifty thousand more—making a demand
of over four hundred and fifty thousand dollars ($450,000) upon his
contracts of one hundred and fifty-eight thousand six hundred dollars
($158,600.)

The items of extras claimed were carefully examined in detail by my
predecessor, Major Bowman, and rejected during Mr. Guthrie’s adminis¬
tration, after the Secretary’s personal examination of the merits of the
claim.

Subsequently the claim was renewed during Mr. Cobb’s administration,
when I examined such items as were then again presented, and coming
to the same general conclusions as Major Bowman, I made a similar
adverse report. Mr. Cobb made a personal examination of the claim,
and after hearing, at a stated meeting, the arguments of the claimant’s
counsel, (John Cochran and Henry B. Stanton, Esqs.,) rejected it.

I am .credibly informed that if I had certified this claim for payment
I should have heard of no Congressional Examining Committee.

The claim was then removed to the Court of Claims. Before this
court, Captain (now General) Franklin was examined as an expert, and
has frequently expressed to me his opinion, coinciding with mine, upon
the claim, but has never ofiicially reported upon it, as he was not in office
when the claim was before the Department.

While the matter was before the Court of Claims, I was detailed by
Mr. Cobb to assist the Solicitor in his examination of some of the
witnesses.

Pending its trial, the claimant’s counsel, in a partly jocose manner,
offered me $20,000 if I would report that there was $70,000 due them
on their claims. I then considered that the offer was made in a serio¬
comic way for the purpose of laughing it off as a jest if I resented it, or
of carrying it into execution if I met it in a kindred spirit; and I there¬
fore only replied that I should report exactly according to the merits of
the claim. I reported, orally, this offer to Mr. Cobb in the same terms
as here written. I now regret that I did not make it matter of record
at the time, as Mr. Cobb cannot be called to substantiate my statement,
and it must rest entirely on my asseveration.

122

Subsequently, and in tbe same manner, the counsel offered me $10,000
if I would report that $50,000 was due them, which I treated in the same
way, and immediately reported the offer to Mr. Cobb.

fn explanation of such offers being possibly serious, while the claim
was before the court, and after I had reported upon it to the Department,
I can only suppose that the claimants might think that if I should report
again after hearing their witnesses, that my views were changed and I
deemed such sums were due them, that the Secretary would then cease to
oppose them before the court, and order the money paid.

The present Secretary may find some corroboration of the above state¬
ment, in the fact that I have orally reported to him a similar offer since
he has been the head of the Department, and may infer therefrom how
far I am open to the charge of venality.

I will not extend this paper by a detail of Mr. Cluskey’s claim, and
the action thereon, which is, in some respects, a similar history, though
differing in detail; and my action thereon was the same as the action of
my predecessor. The claims of both parties have been passed upon by
two administrations preceding your own; and Mr. Cluskey, being from
Georgia, was the personal and political friend of Mr. Cobb, and I am
told (but do not know) that he is now his active sympathizer.

These men are my accusers. In these men the acting chairman of the
committee, Mr. Sargeant, has evidently placed the most entire and abject
confidence. He told me himself that he had “very great confidence in
Mr. Cluskey.”

It is a noticeable fact that my action upon Mr. Cluskey’s or Mr.
Latham’s claims was not made a subject of examination by the committee.
If my official action in their cases was “malicious,” or the result of
“ignorance,” none so competent to prove it as they who were familiar
with their every detail. But on these matters there has been profound
silence; matters only being questioned of which they had no personal
knowledge whatever, or which were the result of the action of others
than myself. They knew , but would not acknowledge, that my action in
their cases was right, so they sought for wrong, and hoped to find it by
a prejudging committee’s aid, where they -were totally ignorant.

This committee, from their official position, are entitled, before action,
to such respect as citizens may choose to award Congressional investiga¬
ting committees. But when, by their action, they cease to deserve
respect I cannot be so hypocritical as to affect any, simply because they
profess to represent their constituents.

I am credibly informed that my accusers have openly avowed for years
past that they would effect my removal, for reporting adversely upon their
claims. Failing at the Department, they have at last found a Congres¬
sional Committee facile and apt to their purpose. My accusers have sat
with this Committee at their examination of witnesses—except when Mr.
Young and myself were examined—propounding questions, and were
subsequently themselves examined in private as witnesses. The commit¬
tee may see a fairness in this method of trial, but I confess that it is not
apparent to me.

123

When I was examined Judge Kelley read the questions from a paper
not in his own handwriting.

The only other person who appears against me before this committee is
a Mr. Hamilton, who was one of Mr. Latham’s witnesses before the Court
of Claims; and in regard to him I shall, at the proper time, present to
Congress the affidavit of the then Solicitor of that Court, that Hamilton
acknowledged on the stand that he had committed perjury. Another of
Mr. Latham’s witnesses, who was not now put upon the stand, was
indicted by the grand jury of New York for perjury, in giving his testi¬
mony upon Mr. Latham’s claim before the Court of Claims.

It is my present intention, also', at the proper time, to present to Con¬
gress the affidavits of respectable citizens of Washington to the effect that
Mr. Cluskey is not to be believed under oath, which, I am advised, can
be readily obtained in large number. Thus much for the men who
have moved and controlled the investigation.

I next desire to place upon the record some unrecorded action of this
committee.

I was the first person examined in form—Judge Kelley being the
examiner. After some weeks examination of me and of papers, he ex¬
pressed himself satisfied, and told me that he desired to question me no
more. He voluntarily told me, at the close of my examination, in the
presence of the committee, that if my character should thereafter be as¬
sailed by any witness, I should be recalled for explanation. Subsequently
he told me that he was disgusted with the whole proceeeding—considered
it puerile, and that he should not meet with the committee again.

Within the past few days Judge Kelley was in this city, and reiterated
these opinions to me, and said, emphatically, that he should seek an
opportunity for an interview with the Secretary, to communicate them to
him; and on the same day I saw him waiting in the Assistant Secretary’s
room for that purpose, as he told me, but do not know whether he ob¬
tained an interview with the Secretary or not. If he did not, my asser¬
tions, all important as they are in this case, can be readily verified by
addressing him a letter, quoting what I have here written.

Judge Kelley’s place upon the committee was supplied by Mr. Sargeant,
of California. This gentleman called upon me at the office for informa¬
tion, and for papers and drawings, all of which were freely, frankly, and
promptly given to him in copy, often to the serious hindrance of the’ cur¬
rent business of the office; and he also said that I should be recalled to
the stand if my character was assailed, or words to that effect. I do not
remember his precise phraseology; I did not charge my memory with his
words, for I did not care whether he recalled me or not, and did not then
know that he was my assailant. I only now record it to exemplify the
animus of the man. His promise was volunteered, not asked for.

I was never recalled.

A virulent report—so steeped in virulence as to kill itself with its own
poison in the judgment of those cognizant of the facts—was made to
Congress by Mr. Sargeant, just before the close of the session, accompa¬
nied by what purported to be the evidence in the case, and the report,

124

with the testimony, was ordered to be printed. The printed copy is now
before me. In it my testimony, taken by Judge Kelley, is printed in a
garbled or altered form, and some of it suppressed, or else not reported
by the committee’s clerk. Some of the printed answers falsify my evi¬
dence. For instance:

Judge Kelley asked me, “ Can you tell, approximately, the amount
already expended?” (on the Treasury Extension.)

I replied: “ I can tell exactly.”

The reply is printed, page 17 of the report, “I cannot tell exactly.”
But the answer, as printed, goes on to state the exact amount expended,
thus making the answer contradictory in itself, and falsifying my reply.

Mr. Young and Mr. Oertly both tell me that like liberties are taken
with their testimony, and that their answers, as printed, give a different
meaning from that intended by their answers to the committee. The only
other witness examined from this office, Mr. Curtis, is not now employed
in it, and I do not know if his testimony be altered or not. For his own
reputation I trust that it is.

Almost all the explanatory statements brought out by examination
before the committee are omitted in the printed record. Whether by
accident or design I can only infer.

The committee have arraigned me, not only for the acts of my prede¬
cessors, but for details of contracts entered into and signed long before I
came into the Department in any capacity. For instance: the contracts
for the custom-house at Charleston, S. C., were made in Secretary
Corwin’s time, 1852-3, and for the Treasury Extension in June, 1855,
and no other contracts are called in question by them. I entered the
Department in August, 1856, and previous to that time had not been in
Washington for twenty years, and had never been interested in or had
any knowledge of any Government contracts. I did not know these
contracts were in existence, nor did I know, nor had I ever heard of, any
of the parties to them until I met them officially in the Treasury. These
facts I stated to the Committee.

I said in my testimony, in reply to inquiries, that soon after being
placed in charge of the Bureau I called the attention of the Secretary
to certain enormities in the Charleston contract, which had come under
my notice as clerk, and told him that, in my judgment, hundreds of
thousands of dollars were being uselessly expended there, and that, in
the then existing state of things, (the work being suspended under the
omission of Congress to make the usual annual appropriation for its con¬
tinuance,) I thought that a new arrangement might be amicably made
with the contractors, by which Government could obtain the remainder
of the marble required for the work at a fair price. The Secretary then
directed me to prepare a statement in detail for his examination. I
caused sueh a statement to be prepared, showing in detail each stone and
its dimensions and its character that were required to complete it, up,
ready for the roof, and what each would cost under the contract prices
as already paid. This statement is matter of record in the office.

Congress having directed the Secretary to report in his (then) next

125

annual report what economy he could make in completing this work, he
instructed me to go to Charleston and see what other economy, besides
that contemplated by the table, I could recommend. The incessant
duties of the office—(as I have never had a chief clerk since I have been
in charge, and consequently was all the time doing double duty)—pre¬
vented (with the assent of the Secretary,) immediate compliance with my
instructions, and the secession of the State soon following, precluded any
further action at the time. These facts were presented in brief in my
then next annual report, and were stated by me in detail to the Com¬
mittee. I also repeated them to Mr. Sargeant, at my desk, after he was
placed on the committee.

Not one word of this statement , or any allusion to it , appears in the
printed testimony or report; but I am, inferentially, charged with
“ignorance or corruption, perhaps both,” (page 1 of report,) for the
existence of the contract.

I respectfully invoke the attention of the Secretary to the fact that
my statements, as given above and suppressed by the committee, exist of
record in this Department.

Mr. Oertly assures me that he also stated, in full detail, to the com¬
mittee, the above facts, with which he was perfectly familiar, and yet no
word of his statement is recorded, nor is there the slightest allusion to it
in the report.

I respectfully submit to the Secretary that this is monstrous and dis¬
graceful injustice on the part of the committee.

Only one cargo of marble for Charleston was paid for subsequent to
the facts above narrated, and that one was then in transit; but an advance
of money was made, pursuant to the terms of the contract, for some
marble at the quarry in Hastings upon Hudson, designed for this building.
The quantity of this marble, (not the quality nor value, as the report of
the committee, page 3, falsely states,) I was ordered by Secretary Dix
to inspect. I did so, and reported. Upon that report the proper officer
(being the one prescribed by the contract,) computed its value. Upon
this computation the amount was paid. These facts all appear in the
documents printed at the close of the testimony in the report, (page 126,)
and yet the report, commenting on the transaction and testimony, as
printed, deliberately denounces me as “incompetent or dishonest” (page
3,) for my action thereon.

In the printed testimony of Mr. Young, (page 24,) which is also printed
by the committee, on page 3 of the report, he is made to state, in reply
to the committee’s question—“Who made the report to you of the quality
of the material at Hasting?”—that “Mr. Clark, the engineer in charge”
reported it. Mr. Young alleges that the questioner said quantity , not
quality, and that he replied accordingly. No one knows better than Mr.
Young that I did not report upon quality, and that it was not my busi¬
ness so to report; and in my report itself, printed at the close of the
testimony, (page 126,) the fact is apparent.

But the malice does not stop at this perversion of truth. The report
says: “To ascertain if this large quantity (not quality) of marble was

126

really at Hastings, the committee sent there Mr. Oertly, Mr. Hamilton,
and Mr. Cluskey to examine it.” They also say “there was a perfect
concurrence between these gentlemen on their return,” (page 2 of report.)

Now, these three gentlemen all report that they found the precise
pieces, and exactly of the same quantity , as stated in my report; but
their witnesses, Cluskey and Hamilton, allege that it was largely over¬
valued under the contract. With the computation of that value I had no
more to do than the committee themselves. I only reported it as the
computation of another, after it had been made by another, and this the
committee kneto, or they must be as stolid as they are unjust, for they print
the fact at page 126. It was neither my province nor privilege to make
the computation; my duty was simply to report it when made. And yet
the committee strangely permit themselves to. state (page 4) that they
“ are fain to believe” that in my incompetency is to be found the expla¬
nation for my action at Hastings!

Now, upon examination, the Secretary will perceive—

First. That quality was not reported upon by me.

Second. That no erroneous report of quality was made by any one.

Third. That no peculiarity of quality, whether reported or not, has
entered into the alleged enormous price.

Fourth. That my report of quantity , being the only point upon which
I had to report, is exact, and confirmed by the committee’s own wit¬
nesses. And,

Fifth. That the valuation of the material was made in pursuance of
the terms of the contract, which contract was not negotiated by me,
and the computation was made by another person, over whom, in that
respect, I had no control.

Whence, then, really comes this enormity of price?

The answer to this query is obvious—was doubtless known to the wit¬
nesses against me before the committee, and thus, probably, to some
members of the committee itself; and this answer, which I will now pro¬
ceed to give, has been most ignorantly, or else dishonestly, and at all
events most unjustly, suppressed.

The answer is, that the enormous price resulted from extraordinary
finish of the material, which extraordinary finish was prescribed by the
Chief of the Bureau, as early as 1853, three years before I came into it,
and then not only prescribed by him, but exemplified for imitation by
models, in accordance with which the marble was to be wrought.

Now, in the face of all this, which was known, or ought to have been
known, to every member of the committee, I am most falsely held up to
you and to the country, in their report, as being responsible for these
enormous prices and payments.

I most earnestly submit to you that I have every right to be indignant
at such wilful suppression and perversion of fact.

I do not propose to further weary the Secretary by now reviewing in
detail all the falsehoods and fallacies of the report. I reserve such re¬
view for its more appropriate occasion; but I desire to call your attention
to one more salient point of the committee’s attack.

127

I refer to the settlement for the rough stock of the buttress caps for
the south wing of the Treasury Extension.

The entire responsibility of this settlement I assume. It was made
under my report and upon my advice.

It is true that I need not assume this responsibility, because the deci¬
sion was that of Secretary Cobb upon my report, and after a careful per¬
sonal examination of it; but as this decision was in strict conformity with
my report, I choose, for my present purpose, to regard it as my own.

The sum of $5,500 was paid for the rough stock of each cap. The
sworn computer, Mr. Oertly, whose duty it is under the law (Statutes at
Large, vol. x, p. 93) to compute their value under the contract, made the
rough stock amount to the enormous sum of $34,104 57 each. The set¬
tlement was a compromise; it is detailed at length in my testimony, pp.
11, 12, and 13, which I respectfully ask the Secretary to read; and the
reasons are there made apparent why the contractors accepted $5,500 on
a contract for nearly $35,000. The compromise sum was reached by the
sworn measurer’s computation of how much these stones would amount to
under all the original rejected bids, and by taking a sum fractionally less
than the lowest of these as a basis of settlement. The committee state in
their report (page 4) that “ Mr. Clark represented that $5,500 was the
lowest price bid for these caps by any bidder.” Thus they convey the
false impression that the computation was mine, when the evidence upon
which they are commenting (page 12) expressly says, the sworn computer
found that these caps amounted,” &c., &c. Thus they demonstrate also
their own utter incapacity to reason, when they put forward the idea that
contractors’ admitted rights, under the strict letter of their contract, to
the enormous sum of $34,104 57 as computed in their favor, by the man
who, under the law, was clothed with exclusive and final computation in
the premises, was not an element in every way to be “ gravely used as
an argument ” in the determination of the proper sum to be paid by a
compromise between the Government and contractors, who, in the terms
of that contract, held the Government at so great a disadvantage.

Mr. Cluskey testifies (page 40) that I omitted in the list of original
rejected bids the bids of three parties. If an omission, it would not be
mine, but the computer’s. But it is no omission. The bids of these
three parties, printed in the report (Hawke’s, pp. 88 and 89; Acker &
Co., pp. 83 and 84; Berry & Mohun, p. 82) show that they made NO bid
for these caps as delivered.

But I did not recommend the payment of $5,500, until I had examined
the computer’s computation under the contract of $34,104 57.

The committee say (page 4) that the computer admits that the rule
whereby this amount is computed is a monstrosity. Be it monstrous or
not, and I know that it is monstrous, the rule is expressly, and beyond
all possibility of honest mistake or denial, written down in the contract;
which contract I did not make or assist in making, but which I was sworn
to execute.

The computation by which the computer obtains the value, under the
contract, is so plain that no truthful expert can arrive at any other re-

128

suit—and any school boy, who had gone half through his arithmetic, could
compute it, under the simple data furnished; thus:

The stone’s admitted contents are 57If cubic feet. The
price per cubic foot for the rough stock of this quantity in
stones of ordinary shape is four fifty one-fourth hundredths

dollars, and therefore amounts to. $2,573 93

The contract provides (report, page 109) that for “all stones
whose width exceeds three times their thickness, there shall
be paid an additional price of twenty-five per cent, for each
additional three inches in width.”

This is the monstrous contract rule.

These stones are 18 feet 8 inches long, 17 feet 6 inches wide,

1 foot 9 inches thick; consequently, for “each three inches”
that “ their width exceeds ” 5 feet three inches, “ twenty-
five per cent, additional is to be paid.” They exceed this
width 12 feet 3 inches—or 49 times 3 inches—and, there¬
fore, 25 per centum must be added 49 times to the amount
of $2,573 93; thus, 25 per cent, of $2,573 93 is $643 48J
Multiplied by.49 is 31,530 64

Making.$34,104 57

This is the monstrous result of the indisputably monstrous contract
rule ; and it must be either stupidity or knavery that produces any other
result, under the rule, than this. Mr. Latham says (page 33) that the
true amount is $2,463 79§, but he starts with a wrong measurement, and
adds nothing for the excess of width over three times the thickness; thus
showing, either that he knew nothing of the matter, or else deliberately
falsified the matter which he undertook, as an expert, truthfully to ex¬
pound under oath.

Mr. Cluslcey, more artful, but not less knavish, adroitly conceals his
method of computation, and gives only his result, and says (page 39) that
that the true amount is $1,958 68, being more than twenty per cent, less
than Mr. Lathams “true amount,” although Cluskey takes the true
dimensions, which are greater than those taken by Mr. Latham. Thus
Cluskey also shows, either that he knew nothing of the matter upon which
he had taken the stand as an expert, or else that he had committed delib¬
erate perjury.

The committee s brace of cherished witnesses and prompters, though
both zealous to accomplish the same object—my removal from office—do
not agree with each other in their computations, nor in their assumed
dimensions. Both cannot be right—both I know are wrong. I believe
that they are knowingly and wilfully wrong. And it is on such testimony
that the committee have, with seeming eagerness, from behind the panoply
of their Congressional shield, attacked my competency and honesty.

Low, I respectfully submit to you, sir, that my action in obtaining a
compromise oi $5,500 from contractors, who, under the terms and statu¬
tory computation of their contract were entitled to $34,104 57, was

129

meritorious official action. I submit to you, sir, that in resorting to the
lowest bid made for these caps to find my rule upon which to compute
the proper amount of the sum to be fixed by compromise, I adopted the
best, and most fair, and just rule possible. I relieved the Government
from the pressure of its most ill-considered contract; and while I took
away from the contractors all power to press their unfair advantage against
the Government, I yet made due recognition of their rights as workmen,
in thus taking for my rule of allowance to them the recorded judgment
of other honest men, making, in competition with each other, proposals to
the Government for the same work. I state to you, sir, respectfully, that
I would, as at present advised, and unless instructed to the contrary, if
the business were now to be done again, adopt precisely the same course.
It is proper for me to add that the then head of the Treasury considered
the compromise effected by me as an eminently successful settlement; but
as I was, myself, exactly informed of all the difficulties which I had to
overcome, I confess that I did not then, and do not now, feel the need of
that attestation.

One other fact—referring to my suppressed testimony—I desire to place
upon the record, and I will, for the present, follow the tortuous malevo¬
lence of the report no farther.

I told the committee at the close of my examination, and desired the
clerk to take down my words, that they had doubtless noticed that I had
made my answers studiously responsive to the questions; that I had in no
single instance interpolated anything which could be construed into a
volunteered defence of my own action. But I demanded, as a right, that
at least some of the witnesses, of whom I then handed them a list, should
be examined. I told them the list contained the names of Senators and
members of the House of Representatives, who had transacted busines for
their constituents at my desk, whom I desired should be examined as to
my general fitness for my duties; and that it also contained the names
of well known experts in this city, and elsewhere, whom I desired to be
examined as to my special fitness.

I was assured that at least some of them should be examined.

Not one of them was examined, or, if examined, their evidence is sup¬
pressed in the report; and not one word of my statement, or any allusion
to it, appears in the printed record.

The committee say, (page 1,) “many witnesses the committee desired
to examine it was impossible to obtain, they being scattered by the im¬
pending war.” None of my witnesses were “scattered by the impending
war,” on the contrary, “many of them” sat daily under the same roof
with, and in the sight of this committee, and not one of them “was it
impossible to obtain.”

The inference is irresistible that they did not “desire to examine”
them. In their holy crusade in search of wrong, the committee have,
with distorted vision, looked beyond the distinguished Senators in their
midst, who proffered me their testimony in my behalf, and sought among
some vagrant followers of the army a support for their own contradictory
witnesses.

130

I do not expect any immediate action from the Secretary upon this
paper, for I am aware that exigences may at times arise in the adminis¬
tration of the Department which require the temporary sacrifice of indi¬
viduals; but if the Secretary is satisfied of the truth of the allegations
herein made by me, I shall hope the time may come when no public detri¬
ment will arise from his making his confidence in my official integrity as
apparent and public, as his seeming want of it now appears; for I do not
want the humblest office at the Secretary’s disposal, unless he has the
confidence that I shall faithfully discharge its duties.

So long as I occupy my present position, I shall to the best of my
abilities discharge its duties. I have served under five Secretaries of the
Treasury, and this is the first time I was ever before any of them with a
personal matter. I trust it may be the last. The promotions I have
received have been voluntary. They came to me from a supposed fitness,
and without solicitation on my part, or on the part of friends for me.
They have not been given me for party reasons, for I am no partizan, and
I can never be of service to any politician, except by the faithful perform¬
ance of my duty.

I have the honor to be, very respectfully, your obedient servant,

S. M. CLARK,

C. C. Bureau of Construction.

To Hon. S. P. Chase,

Secretary of the Treasury.

INVENTORY

Of Bed-pieces, Rolls, Lathe Cuttings, Plates and Stock
hand October 1, 1864.

INVENTORY OF ENGRAVED PLATES.

FRACTIONAL CURRENCY.

30 plates of 25 subjects,

5 cents,

obverse.

do.

reverse.

do.

obverse.

do.

reverse.

do.

obverse.

do.

reverse.

do.

obverse.

do.

reverse.

do.

FRACTIONAL CURRENCY, !

26 plates of

‘ 12 subjects.

, 50 cents.

, obverse.

do.

reverse.

do.

reverse.

do.

132

BOND PLATES, FIVE-TWENTIES.

9 plates of

$50 Coupon Bonds,

3d series.

do.

altered to act June 30, 1864.

do.

4th. series.

do.

100

do.

3d series.

do.

100

do.

4th series.

do.

100

do.

altered to act June 30, 1864.

do.

500

do.

4th series.

do.

500

do.

altered to act June 30, 1864.

do.

500

do.

coupons cut off for foreign loan.

do.

1,000

do.

3d series.

do.

1,000

do.

4th series.

do.

1,000

do.

altered to act June 30, 1864.

do.

1,000

do.

coupons cut off for foreign loan.

do.

1,000

do.

reverse, 4th series.

do.

1,000

do.

do. act June 30, 1864.

do.

50 Registered Bonds,

do.

tint,

do.

100

do.

100

do.

tint,

do.

500

do.

500

do.

tint,

do.

1,000

do.

1,000

do.

tint,

do.

5,000

do.

5,000

do.

tint,

do.

10,000

do.

10,000

do.

tint,

do.

20 years.

do.

100

do.

BOND PLATES,

TEN-FORTIES.

3 plates of

$50 Coupon Bonds.

do.

100

do.

100

do.

unfinished.

do.

500

do.

1,000

do.

50 Registered Bonds.

do.

unfinished.

do.

100

do.

100

do.

unfinished.

do.

500

do.

500

do.

unfinished.

do.

1,000

do.

1,000

do.

unfinished.

do.

5,000

do.

133

plates of

$5,000 Registered Bonds, unfinislied.

do.

10,000

do.

10,000

do. unfinished.

BOND PLATES, 6 PER CENTS OF ’81.

1 plate of

$50 Coupon Bonds, acts July 17 and Aug. 5,1861.

do.

do. act March 3, 1863.

do.

do. tint, acts July 17 and Aug. 5,1861.

do.

do. tint, act March 3, 1863.

do.

100

do. acts July 17 and Aug. 5, 1861.

do.

100

do, act March 3, 1863.

do.

100

do. tint, acts July 17 and Aug. 5,1861.

do.

100

do. tint, act March 3, 1863.

do.

500

do.

500

do. unfinished.

do.

500

do. tints.

do.

1,000

do.

1,000

do. unfinished.

do.

1,000

do. tints.

do.

50 Registered Bonds.

do.

do. unfinished.

do.

do. tint.

do.

100

do.

100

do. unfinished.

do.

100

do. tint.

do.

500

do.

500

do. tint.

do.

1,000

do.

1,000

do. tint.

do.

5,000

do.

5,000

do. tint.

do.

10,000

do.

10,000

do. tint.

SEVEN-THIRTY TREASURY NOTES.

2 plates of

$50, 3 subjects, obverse.

do.

do. tints.

do.

do. reverse.

do.

100

do. obverse.

do.

100

do. tints.

do.

100

do. reverse.

do.

500

do. obverse.

do.

500

do. tint.

do.

500

do. reverse.

do.

1,000

do. obverse.

do.

1,000

do. tint.

do.

1,000

do. reverse.

134

plate of $5,000, 1 subject,

obverse.

do.

5,000

do.

tint.

do.

5,000

do.

reverse.

do.

50, 4 subjects, obverse.

do.

do. unfinished.

do.

reverse.

do.

tints.

do.

100

do.

obverse.

do.

100

do.

reverse.

do.

100

do.

tints.

do.

500

do.

obverse, unfinished.

do.

500

do.

reverse.

do.

500

do.

tint.

do.

1,000

do.

obverse, unfinished.

do.

1,000

do.

reverse.

do.

1,000

do.

tint.

one-year interest notes.

7 plates of

$10, obverse.

do.

tints.

do.

reverse.

do.

obverse.

do.

tints.

do.

reverse.

do.

obverse.

do.

tints.

do.

reverse.

do.

100

tint.

do.

100

reverse.

do.

500

tint.

do.

500

reverse.

do.

1,000

tint.

do.

1,000

reverse.

do.

5,000

obverse.

do.

5,000

tints.

do.

5,000

reverse.

TWO-YEARS INTEREST NOTES.

2 plates of $50, obverse.

2 do. 50 tints.

2 do. 50 reverse.

2 do. 100 obverse.

2 do. 100 tints.

2 do. 100 reverse.

1 do. 500 obverse.

1 do. 500 tint.

135

1 plate of $500, reverse.

1 do. 1,000 obverse.

1 do. 1,000 tint.

1 do. 1,000 reverse.

THREE-YEARS COMPOUND INTEREST TREASURY NOTES.

15 plates of $10, obverse.

12 do. 10 reverse.

15 do. 20 obverse.

14 do. 20 reverse.

8 do. 50 obverse.

11 do. 50 reverse.

2 do. 100 obverse.

3 do. 100 reverse.

1 do. 500 obverse.

1 do. 500 do. unfinished.

1 do. 500 reverse.

1 do. 1,000 obverse.

MISCELLANEOUS.

1 plate of Certificate of Deposite.

1 Cover-plate for the Fractional Currency.

1 plate of Letter-head, National Currency Bureau.

1 do. $1,000, Certificate of Indebtedness, 1 subject.

1 do. Treasury Draft or Warrant, 4 subjects.

1 do. War do. do. do.

1 do. Interior do. do. do.

1 do. Navy do. do. do.

1 do. Yignette portrait of Secretary Chase.

1 do. do. do. do. Fessenden.

1 do. $5,000, Certificate of Deposit, 1 subject.

1 do. Certificate of Deposit, original and duplicate.

1 do. Check of the Assistant Treasurer of New York, 5 subjects.

1 do. Coin Check, 5 subjects.

1 do. Alphabet.

1 do. Specimen plate of Cycloid ruling.

1 do. do. do. do.

1 do. $1,000, Certificate of Indebtedness, 3 subjects.

1 do. • $5,000, Certificate of Indebtedness, 3 subjects.

1 do. Exequatur.

1 do. Passport.

1 do. Letter-head, Second Auditor.

BLANK STEEL.

601 plates, nine by fourteen inches.

76 do. nine by fifteen and a quarter inches.

136

62 plates twenty and a half by fourteen and a half inches.

19 do. twenty by fourteen and a quarter inches.

28 do. eighteen by fifteen and a quarter inches.

15 do. twenty by fourteen and a half inches.

20 do. twenty by thirteen and a half inches.

53 do. twenty by thirteen and a quarter inches.

19 do. twelve by twelve and three quarters inches.

6 do. seventeen by thirteen and a quarter inches.

2 do. nine by fifteen inches.

2 do. seven and a half by fifteen inches.

BLANK BOLLS..

40 rolls, half inch face.

8 do. five-eighths inch face.

13 do. nine-sixteenths inch face.

7 do. one inch face.

5 do. one and an eighth inch face.

7 do. one and a quarter inch face.

16 do. one and a half inch face.

9 do. one and five-eighths inch face.

7 do. one and three-quarters inch face.
23 do. one and seven-eighths inch face.

9 do. two inch face.

6 do. two and one-eighth inch face.

6 do. two and three-eighths inch face.

11 do. two and a half inch face.

6 do. two and five-eights inch face.

3 do. two and a quarter inch face.

4 do. three inch face.

41 do. three and a quarter inch face.

16 do. two and three-sixteenths inch face.
1 do. two and a quarter inch face.

1 do. one and five-eighths inch face.

6 do. three and a half inch face.

2 do. three and five-eighths inch face.

2 do. one-quarter inch face.

2 do. three-eighths inch face.

2 do. one-half inch face.

1 do. five-eighths inch face.

5 do. three-quarters inch face.

3 do. seven-eighths inch face.

do.

one

inch

face.

do.

one

and

one-eighth inch face.

do.

one

and

a quarter inch face.

do.

one

and

a half inch face.

do.

one

and

five-eighths inch face.

do.

one

and

three-quarter inch face.

137

13 plates one and seven-eights inch face.

7 do. two inch face.

1 do. two and three-quarters inch face.

1 do. three and a quarter inch face.

6 do. one and three-eighths inch face.

9 do. two and three-sixteenths inch face.

3 do. two inch face.

6 do. one and seven-eighths inch face.

3 do. one and three-quarters inch face.

3 do. one and five-eighths inch face.

3 do. one and a half inch face.

3 do. three and five-eighths inch face.

BED-PIECES.

FRACTIONAL CURRENCY,

Skeleton obverse,
do. reverse.

Vignette, head of Washington,
do. do.

5 cent obverse.

5 cent-reverse.

10 cent obverse.

10 cent reverse.

25 cent obverse.

25 cent reverse.

50 cent obverse.

50 cent reverse.

FRACTIONAL CURRENCY—NEW ISSUE.

1 50 cent reverse.

2 50 cent obverse.

3 25 cent reverse.

4 3 cent do.

$5,000 ONE-YEAR INTEREST NOTE.
Obverse.

23 Vignette, America offering her jewels.

23 a , do. do. do.

142 Original lathe-work of oval counter, 5,000.

142 a, 5,000 counter, matched.

142 b, Finished lathe-work counter, with denomination.

143 a, do. do. do. small 5,000.

144 Washington, October 1, 1863.

145 United States.

18*

No.

8
9

188

No.

146 Will pay the bearer with interest, &c.'

147 Five thousand dollars.

148 Corner-piece, 5,000, scroll-work.

148 a, do. do. do.

149 Legal tender for $5,000. Register of Treasury and Treasury Dept.

150 Kaleidograph border.

167 Check letters, ABCD.

153 Kaleidograph tint, 5,000 repeated, in scroll.

153 do. original, do. do.

Reverse.

155 Vignette, eagle.

156 5,000, lathe-work counter.

157 Every person, &c., ornamented with scroll.

158 This note is a legal tender, &c.

158 b, Scroll-work.

$1,000 TWO-YEARS INTEREST NOTES.

Obverse.

120 Vignette, naval battle scene.

121 do. Desoto.

123 Legend of note.

124 Original kaleidograph counter, 1,000.

124 a , Finished do. do.

125 Tablet, act of March 3, 1863.

126 Original kaleidograph border of note.

127 Finished do. do.

128 Original lathe-work counter tint, 1,000.

128 a, Finished do. do.

129 Scroll-work tint over coupon.

Reverse.

130 Original kaleidograph of coupon.

130 a, Finished do do. with scroll.

124 Kaleidograph counter, 1,000, original.

124 c, do. do. finished.

122 Vignette, eagle.

131 Scroll-work, with lettering; penalty.

129 b, This note is a legal tender, &c., for all debts, &c.

167 Check letters. No.

125 a, Tablet. Legal tender for one thousand dollars.

$1,000 ONE-YEAR INTEREST NOTE.

Obverse.

Vignette, Justice,
do. Liberty.

139

No.

132 Vignette, Eagle and shield, “ In God is our trust.”

133 Corner ornaments, M and 1,000, in scroll.

134 One year from date.

135 One thousand dollars, with interest, &c.

135 «, United States.

135 b, do.

136 Will pay the bearer.

136 a, Act of March 3, 1863.

134 a, “M” printed in color.

134 b, 5,000 ruled do.

137 1,000 repeated.

Reverse.

130 Original kaleidograph of centre.

130 a, Finished 1,000, and one thousand, kaleidograph.

138 Scroll-work corner pieces.

139 Original lathe-work counter.

140 Lathe-work, with lettering: the penalty.

141 do. do. this note is, &c.

$500 TWO-YEARS INTEREST NOTE.

Obverse.

183 Vignette, Eagle and nest.

183 a, do. Liberty.

184 United States.

185 Lathe-work counter, 500.

186 Five hundred dollars, will pay to bearer, &c.

187 Signatures.

188 Washington.

189 Lower corner ornaments.

190 U.'S., ornaments, flowers and scroll.

191 This note is a legal tender for five hundred dollars.

191 a , Section of border, U. S. and D.

193 Treasury note, in tablet.

194 Act of March 3, 1863.

194 a , Register of the Treasury. Treasurer of the United States.

195 Two years after date.

196 Corner ornaments and scroll, U. S.

207 Coupon, $12 50.

192 Finished border, U. S. and D.

Obverse tint.

204 Cycloid work over note.

205 D, ornamented with scroll.

206 Pentogrhph tint over coupon.

140

Beverse.

No.

209 Lathe-work, with lettering and denomination.

196 Small corner ornaments.

211 Lathe-work over coupon.

209 a, Section of counter, 500.

$500 ONE-YEAR INTEREST NOTE.

Obverse.

68 Vignette, Standard bearer. •

72 do. New Ironsides.

164 Finished lathe-work counter, 500.

164 a, Original do. do.

164 b, do. do. do. before lettering.

155 d, Legal tender for five hundred dollars.

155 c, Act of March 3, 1863.

155 f, Border of note, end pieces, lathe-work.

155 < 7 , Section do. do.

160 a, Treasury note, one year after date, &c.

161 Five hundred dollars, with interest, &c.; Washington.

160 b, Corner ornaments.

Obverse tint.

165 Cycloid 500, repeated. *

165 a , do. section.

107 D, ruled face.

Beverse.

163 Lathe-work, full note.

163 a, do. original.

163 b, do. circular.

163 c , do. section.

$100 TWO-YEARS INTEREST NOTE.

102 Vignette, In the Turrett.

102 a, do. Farmer and mechanic.

103 Border of note, C, one thousand, repeated.

103 a, do. C.

104 Treasury note. Two years after date the United States will pay

bearer one hundred.

105 Dollars, with interest at five per cent, per annum, payable semi¬

annually. The last six months interest will be paid with this
note. Washington, Dec. 1, 1863. Act March 3, 1863.

141

No.

106 Vignette, View of the Treasury.

108 Coupon of the note.

109 Lathe-work counter, obverse of note in tint.

110 Qriginal lathe-work of counter, C and 100.

110 a , Finished do. do.

111 Lathe-work tint over obverse of note.

112 Section of do. do.

118 Lathe-work strip over obverse of coupon.

114 Legal tender for one hundred dollars.

115 Lathe-work C, reverse of coupon.

116 do. reverse of note with lettering.

117 do. original of the reverse.

$100 ONE-YEAR INTEREST NOTE.

Obverse.

Vignette, Washington,
do. Justice,
do. Victory and Peace.

United States.

One year after date.

Act of March 3, 1863.

One hundred dollars.

U. S., corner ornaments, scroll and flowers.

do. do.

Counter, lathe-work, 100.

This note is a legal tender for one hundred dollars.
Border, U. S. and C.

Check letters, AB CD.

Washington, in script.

Signatures.

218 a , Lathe-work.

218 b, do. C.

195 b , Scroll, belonging to lathe-work.

Reverse.

233 a , Lathe-work, with lettering and denomination.

233 b, Half section of counter.

233 c, Section of lathe-work.

$50 TWO-YEARS INTEREST NOTE.

Obverse.

199 a ,
199
228
184 a,
220 a,

229

230
196 a,
196
218
332
232 a,
220
188
187
194

197 Vignette, Caduceus.
214 a, do. Loyalty.
199 do. Justice.

142

No.

185 a, Counter, lathe-work, 50.

185 b, United States.

200 Two years after date will pay to bearer, fifty dollars with interest

at five per.

201 Cent, per annum, payable semi-annually. Washington. The last

six months interest will be paid with this note.

201 a, Lathe-work counter, 50, section of a circle.

201 b, do. without denomination.

195 a, Act of March 3, 1863.

187 Signatures.

208 Coupon, $1 25.

208 a, do.

Obverse tint.

204 Lathe-work tint.

208 a, L, ornamented with scroll.

195 b, Scroll-work, belonging to tint.

210 This note is a legal tender for fifty dollars.

210 a, Treasury note, in tablet.

196 a, Scroll-work corners, U. S.

194 b, Small border, 50 and United States repeated.

206 Pentograph tint over coupon.

Reverse.

212 Lathe-work lettering and denomination.

do. fifty dollars, reverse of coupon.

218 a, do. do. section.

$50 ONE-YEAR INTEREST NOTES.

Obverse.

214 Vignette, Loyalty.

234 do'. Alexander Hamilton.

185 b, United States.

216 a, Lathe counter, 50.

235 Fifty dollars.

235 a, Lathe counter, fifty.

235 b, Ornamental scroll corner, fifty, 50.

195 a, Act of March 3, 1863.

210 a, One year after date, in tablet.

210 This note is a legal tender for fifty dollars.

188 Washington.

220 Check letters.

194 a, Register of the Treasury and Treasurer of the United States.
187 Signatures.

194 a, Lathe border, end piece, United States 50.

143

Obverse tint.

No.

231 Lathe-work.

Reverse.

241 Lathe-work, denomination, &c.

241 Section of lathe-work.

$20 ONE-YEAR INTEREST NOTE.

Obverse.

70 Vignette, portrait of President Lincoln.

71 do. Victory.

69 do. Mortar firing.

156 Original, lathe-work of corner piece 20.

157 Finished do. do. do.

158 Border of note, lathe-work, twenty, 20.

158 a, Section of lathe-work do.

155 a, Legal tender for twenty dollars.

159 Corner ornament, In God is our trust.

159 do. do. God and our right.

160 Legend qf note.

161 With interest at five per cent, Washington.
155 b, Act of March 3, 1863.

155 c, Check letters.

Obverse tint.

162 Cycloid tint 20, repeated.

162 a, do. do. section.

Reverse.

153 Lathe-work of full note.

154 do. original.

155 20, XX, repeated.

$10 ONE-YEAR INTEREST NOTE.
Obverse.

214 Vignette, Eagle and Capitol.

215 do. portrait of Secretary Chase.

215 a , do. Peace.

216 do. United States.

216 One year after date, act of March 3, 1863.

144

No.

217
216 b,
216 e,
219
188
187
196
221
222
223
223 a,
193

225

226

227
225 a,

59 a,

50 a,
50 d,
55 a,
63

64 a,
67

67 a,

50 e,
50 /,
50 < 7 ,

Lathe-work counter, 10.

do. do. X, ornamented with scroll,
do. do. X, do. do.

Ten dollars, with five per cent, interest.
Washington.

Signatures.

Corner ornaments, U. S.

This note is a legal tender for ten dollars.
United States, ten, 10, repeated.

United States of America, ten, repeated.

do. do. do. section.

Treasury note, in tablet.

Obverse tint.

Lathe-work.

do. figure X.

Reverse.

Lathe work, with-lettering and denomination,
do. counter, 10 .

§1,000 5-20 bond.

It is hereby certified that. *

United States of America, with scroll.

United States of America, with scroll; with lettering, six per
cent, loan, under act of February 25,1862. Redeemable after
five, &c.

One thousand dollars.

Lathe-work counter, No. and third series.

Scroll work, belonging to border.

Lathe-work, one thousand counter,
do. M, and corner pieces.

Vignette, Farmer mowing,
do. Girl at the well,

do. Eagle with flag.

do. do. with lettering, are indebted unto.

Coupon, §30.
do. §30.

Original lathe-work of the border of bond.

do. do. of strip parallel with border,

do. do. of counter, one thousand,

do. do. do. M.
do. do. of corner piece.

United States of America, ruled face.

Lathe-work 1 , 000 , reverse of bond.

145

86 Ruled oval counter, fourth series and 4tli.

87 Cycloid counter, $30, reverse of coupon.

78 Cycloid counter, M and 1,000, with lettering, six per cent, loan,
under act, &c.

91 One thousand dollars and writing of the bond.

98 It is hereby certified that the, Treasury Department, Register s
. office, are indebted unto, No.

100 Coupon, $30, obverse.

$500 5-20 bonds.

46 United States of America.

46 a, do. do.

47 Rive hundred dollars.

48 Lathe-work counter, No.

49 do. do. 3d and third series.

50 do. do. D.

50 b, Lathe-work counter, D, with lettering, six per cent, loan under
act of February 25, 1862.

50 c, Lathe-work counter D, with lettering, redeemable after five and

payable twenty years from date.

51 Lathe-work counter, five hundred.

52 do. do. 500.

53 Vignette, Head of President Lincoln.

54 do. do. Gen. Scott.

55 do. Eagle.

56 Coupon, $15.

58 Original lathe-work of the border of bond.

51 b, do. counter, five hundred.

52 a, do. counter, 500.

57 do. coupon border.

57 a , do. do.

50 7i, do. counter D.

49 a, do. counter, 3d series.

92 Ruled counter, 4th series and 4th.

$100 5-20 BONDS.

15 Two tablets with legend.

16 Register’s office, May.

16 Treasury Department, November, No.

17 One hundred dollars.

18 The United States of America are indebted unto.

19 Kaleidograph border, with matched corner.

20 Coupon, $3 00.

21 Vignette, Justice.

22 do. Liberty.

23 do. America offering her jewels.

146

No.

24 Original lathe-work of $100 counter.

25 Matched do. do.

26 Original corner piece.

27 do. counter, 3d.

28 Matched counter, with denomination.

29 Border kaleidograph.

99 Fourth series, black-face letter.

$50 5-20 bond.

34 a, It is hereby certified that.

34 b, The United States of America.

34 c, Are indebted unto.

35 Fifty dollars.

36 Kaleidograph border, with matched corner.

37 do. do.

38 Kaleidograph counter, 50.

39 Kaleidograph counter, with lettering, third series and Treasury

Department.

40 Vignette, Eagle.

41 do. America and peace.

42 do. Reclining Indian.

43 Treasury Department, Register’s office, Register of the Treas.. Nc.

44 Coupon, $1 50.

29 Kaleidograph border.

15 a, Tablets with legend.

89 Coupon, $1 50, 4th series.

38 a, Lathe-work corner piece, to match border.

MISCELLANEOUS STOCK.

77 Scroll work corner piece.

79 It is hereby certified that, Treasury of the United States, Regis¬

ter of the Treasury.

75 Corner piece, figure 2 and word two ; lettering, receivable fur all
United States stamps; engraved and printed at the Treasury
Department.

80 Are indebted unto.

81 One thousand dollars, Washington, No. and ruled counter 1,000.

82 If the order blank is not filled this, United States Treasury.

85 Alphabet or check letters.

88 Counter, 50 dollars, 100 dollars, 500 dollars vyith lettering, Treas¬
ury Department, National Currency Bureau, and official business.

94 Border strip of lathe-work.

95 b, United States Treasury seal.

95 a, do. do.

90 Signatures of F. E. Spinner and L. E. Chittenden.

98 Fifty dollars, a small black-face letter.

147

97 Counter, 100 dollars and 50 dollars.

102 Draft and $.

118 United States of America, fancy letter, black face.

151 Interest 5 per cent.

152 Tst February, 1864.

30 It is hereby certified that.

31 Phillebrown head of Washington.

33 Five per cent, loan under act of March 3, 1863, redeemable after
ten and payable forty years from date.

95 c, United States Treasury seal.

119 Kaleidograph counter, 1,000.

167a to h $25 coupon belonging to the $1,000 10-40.

168 $5 do. do. $100 10-40.

170 Five thousand dollars, Certificate of Indebtedness, one.

171 $12 50 coupon belonging to the $500 10-40.

171 a, do. do. do.

176 Lathe-work oblong counter.

181 Oval lathe-work counter.

182 Section of border.

181 a, Lathe strip.

181 b, do. double.

182 a, do. border.

182 a b, do. do. double.

176 b, do. do.

203 do. section.

203 a, do. do. strip.

202 Lathe counter, (large).

164 do. section of counter.

236 do. do. do.

237 do. do. do.

239 Treasury warrant No., in favor of, on, $. Pay to, or order, on
Treasury warrant, No., 186. Pay to, or order, issued on requi¬
sition No., registered, 186.

Lathe border strip.

Lathe-work, small oblong counter,
do. do. do.

do. miscellaneous.

Three years after date, compounded semi-annually.

Three years, three years after date.

Assistant Treasurer of the United States.

Collector’s office, New York, 186. Pay to the order of, in coin,
Auditor.

164 a,
238 a,
238 b,
244

246

247

248

249

250 Will pay the bearer fifty dollars, with interest at the rate of six

per cent, per annum.

251 Three years, with interest at the rate of six per cent, per annum,

Compounded semi-annually.

238 Lathe-work border.

148

No.

244 a, Lathe-work border.

151 a, do. counter.

240 Reverse of three years interest notes with legend.

238aa, Section of lathe.

252 Reverse of three-year $50 interest note with legend.

254 Treasury Department, New York.

240 a, Reverse skeleton of three years note.

151 a , Lathe-work border.

238 a, Lathe strip border.

255 Six months interest due July 1, 1881, payable with this bond,

entered, recorded, Washington.

256 Register’s office, Treasury Department.

259 Cycloid tint for $1,000, 6, 81, coupon 30.

260 Coupon for $15, 6, 81, bonds.

261 do. $30 do. do.

263 Cycloid tint for $500, 6, 81, coupon 15.

264 a, do. fancy faced letter, fifty.

264 do. do. figure 500.

267 Coupon cycloid tint, with lettering act of March 3, 1863.

266 Section of lathe-work.

268 100 cycloid ruled face.

269 It is hereby certified that, plain white face letter.

273 Three years after date, with interest, at the rate of five per
cent., &c.

272 Lathe-work mitre for $20, reverse three years note.

279 Five coupons attached, last six months interest payable with note.
278 Act of June 30, 1864.

276 Lathe-work narrow border.

154 do do. do.

280 Act of June 30, 1864, interest one cent per day, two cents per

day, &c.

281 $500 reverse, with legend for 7-30.

283 $20, reverse for the $20 three years interest notes.

284 Double lathe-work counter 1,000

285 Lathe section of circle, 1,000.

286 Reverse of the $50, 7-30, with legend.

287 Lathe and cycloid work with lettering, pay to bearer

288 $100 reverse 7-30 with legend.

289 Compounded semi-annually.

290 Coupon for 7-30, $500, $18 25.

290 do. do. $100, $3 65.

291 do. do. $1,000, $36 50.

291 do. do. $50, $1 82J.

292 At maturity, &c., in a small lathe border for reverse $1,000, 7-30.

293 Three years after date, black face letter.

294 Semi-annually in lawful money, payable, interest.

295 Signature, S. B. Colby.

149

296 Act of July 17 and August 5, 1861.

297 $5,000 coupon for 7-30.

298 The United States of America, black face.

254 a, Treasury Department.

299 The United States of America, ruled face.

300 do. do. do. black face.

301 Act of June 30, 1864, in tablet.

302 Six per cent, loan under act of June 30, 1864, in tablet.

303 Promise to pay to the order, with 7-30 per cent, in lawful money,

semi-annually, August 15, 1864, February 15, August 15.

304 Six per cent, loan under act of June 30, 1864.

305 United States of America, ornamented with stars.

308 Six months interest due November 1, 1864, payable with this

bond, No.

309 Washington, August 15, 1864, promise to pay, dollars to the

order, of 7-30 per cent, interest, payable semi-annually in
lawful money.

310 United States of America, black face.

311 Fifty dollars.

213 a, Portrait of Secretary Fessenden

312 Promise to pay to the bearer, &c.

314 Treasury Department, ornamented with scroll.

315 Six months interest $1 50, six months interest $3, six months

interest $15, six months interest $30, six months interest $150,
six months interest $300.

317 Ten thousand dollars, five thousand dollars, one thousand dollars,

five hundred dollars, one hundred dollars.

318 Sections of lathe-work for borders.

319 do. do. do.

320 Counter 25 and section of lathe border.

321 One thousand dollars, German text.

323 Lathe-work counter.

325 Scroll work, ornaments.

327 Fifty dollars repeated, and Nos. repeated, and $, and X.

328 Lathe counter with denomination 3.

340 No. and $, plain and fancy letters.

UNITED STATES NOTES.

73 Scroll work for back of two dollars.

74 Two flags do. do.

76 Scroll work.

77 a , Section of counter, two.

77 5, Sectional counter, two, complete.

306 The emigration of the pilgr ims .

307 The landing of Columbus.

De Soto on the Mississippi.

Also forty-three shells or lathe-cuttings of counters, borders &c.

150

ROLLS.

FRACTIONAL CURRENCY—NEW ISSUE.

1 50 cent reverse.

1A do.

2 50 cent obverse.

2 A do.

2 B do.

2 C do.

2 E do.

2 F do.

2 0 do.

211 do.

1 B 50 cent reverse.

3 25 cent reverse.

3 A do.

3 B do.

3 C do.

4 3 cent reverse.

4 A do.

4 B do.

4 C do.

4 D do.

4 E do.

4 F do.

4 G do.

FRACTIONAL CURRENCY.

1 Skeleton obverse.

2 Skeleton reverse.

3 Head of Washington, by Ourdan.

do. more highly finished.

5 5 cent obverse.

6 5 cent reverse.

7 10 cent obverse.

8 10 cent reverse.

9 25 cent obverse.

10 25 cent reverse.

11 50 cent obverse.

12 50 cent reverse.

7 a, 10 cent obverse, mandril roll.

8 a, 10 cent reverse, do.

5 a, 5 cent obverse, do.

6 a, 5 cent reverse, do.

9 a, 25 cent obverse, do.

10 a, 25 cent reverse, do.

151

11 a,

12 a,
7 b,
7 <7,
9 b,
9 c,
7 d,

7 e,

8 b,
5 b,

9 d,

5 b,

6 b,

7 fi,

8 b,

9 b,
10 b,

No.

142

142 a,

143
143 a,

143 b,

144

145

145 a,

146

147

147 a,

148

148 a,

149

149 a,

150
150 a,
150 b,
166
153
153 a,

155

155 a,

50 cerft obverse, mandril roll.
50 cent reverse, do.

10 cent obverse,
do.

35 cent obverse,
do.

10 cent obverse,
do.

10 cent reverse.

5 cent obverse.

25 cent obverse.

5 cent obverse, mandril roll.

5 cent reverse, do.

10 cent obverse, do.

10 cent reverse, do.

25 cent obverse, do.

25 cent reverse, do.

$5,000 ONE-YEAR INTEREST NOTES.

Obverse.

Vignette, Wealth offering up her jewels.

Original lathe-work of oval counter 5,000.
do. do. finished, 5,000.

do. do. of small counter 5,000.

d°* do. do. do. finished, 5,000.

do. do. do. do. do.

Washington, October 1, 1863.

United States,
do.

Will pay the bearer with interest, &c.

Five thousand dollars,
do. do.

Ornaments, 5,000 scroll work,
do. do. do.

Legal tender for 5,000 dollars.

Kaleidograph border in sections, 5,000 repeated.
f°- do. do. do. do.*

do do. do. do. do.

Check letters A, B, C, 1).

Kaleidograph tint on obverse of note printed in color
do. do. do. do. do.

Heverse.

Vignette, Eagle, &c.
do. do.

152

No. •

156 5,000 lathe-work counter, original.

156 a, do. do. finished.

157 Penalty, &c., ornamented with scroll.

158 This note is a legal tender, &c.

158 a, do. do. do.

158 b, Scroll work, corner pieces.

$1,000 TWO-YEARS INTEREST NOTES.

Obverse.

120 Vignette, Naval battle scene.

120 a, do. do.

121 do. De Soto.

121 Legend of note.

124 Original kaleidograph counter of 1,000.

124 a, Finished do. do. do.

125 Tablet, act of March 8, 1863, Treasury note.

125 a, Tablet, legal tender for one thousand dollars.

126 a, Original kaleidograph border of note.

126 b, Finished do. do. do.

126 c, do. do. do. do.

127 Coupon of note.

128 Original lathe-work counter of tint 1,000.

128 a, Finished do. do. do.

129 Scroll work in tint over coupon.

129 a, do. do. • do.

Reverse.

130 Original kaleidograph of coupon.

130 a, Finished do. do.

124 b, Kaleidograph of the body of note.

124 c, Finished kaleidograph 1,000 counter.

122 Vignette, Eagle.

131 Scroll work, lettering, penalty.

129 b, This note is a legal tender, &c.

129 c, Except duties, &c.

167 Check letters A, B, C, D, and No.

$1,000 ONE YEAR INTEREST NOTES.
Obverse.

21 a, Vignette, Justice.

21 b, do. do.

22 do. Liberty.

132 Vignette, Eagle and shield, “ In God is our trust.”

133 Corner ornaments, M and 1,000, in scroll.

153

No.

134 One year from date.

135 One thousand dollars, with interest, &c.

135 a, United States.

135 b, do.

136 'Will pay the bearer.

136 a, Act of March 3, 1863.

Obverse tint.

134 a , “M” ornamental letter.

134 b, 5,000, ruled face.

134 c, do do.

Reverse.

130 b, Original kaleidograph of centre.

130 c, Finished 1,000, and one thousand,

138 Scroll-work corner pieces.

139 Original lathe-work counter.

139 a , Section do. do.

140 Lathe-work, with lettering: the penalty.

141 do. do. this note is, &c.

$500 TWO-YEARS INTEREST NOTE.

Obverse.

183 Vignette, Eagle and nest.

183 a, do. Liberty.

184 United States.

185 Lathe-work counter, 500.

186 Five hundred dollars, will pay to bearer, &c.

187 Signatures.

188 Washington.

189 Lower corner ornaments.

190 U. S., ornaments, flowers and scroll.

191 This note is a legal tender for five hundred dollars.

191 a, Section of border, U. S. and D.

192 Finished border, U. S. and D.

193 Treasury note, in tablet.

194 Act of March 3, 1863.

194 a, Register of the Treasury. Treasurer of the United States.

195 Two years after date.

196 Corner ornaments and scroll, U. S.

207 Coupon, $12 50.

Obverse tint.

204 Cycloid work over note.

205 D, ornamented with scroll.

206 Pentograph tint over coupon.

154

No.

209

196

211

Lathe-work, with lettering and denomination.
Small corner ornaments.

Lathe-work and D over coupon.

0500 ONE-YEAR INTEREST NOTE.

Obverse.

68 Vignette, Standard bearer.

72 do. New Ironsides.

164 Lathe-work counter, 500.

164 a, do. original of counter and sections.

164 b, do. do. do. before lettering.

155 d, Legal tender for five hundred dollars.

155 e, Act of March 3, 1863.

155 /, Border of note or end piece, 500 repeated.

155 g, Section do. do.

160 a, Treasury note, one year after date, &c.

161 Five hundred dollars, with interest, &c.; Washington.
160 b, Corner ornaments.

Reverse.

163
163 a,
163 b,
163 e,
163 d,
163 e,
163/,
163 g,
163 h,

Lathe-work, combination.

do. original, combination,
circular, do.
section,
do.

do.

Obverse tint.

165 Cycloid 500, repeated.

165 a , do. section.

107 D, ruled face.

0100 TWO-YEARS INTEREST NOTE.

102 Vignette, In the Turrett.

102 a, do. Farmer and mechanic.

103 Border of note, C, one hundred repeated.

103 a, do. C.

104 Treasury note. Two years after date the United States will pay

bearer one hundred.

105

106

108

109

110

110 a,

111
112

113

114

115

116
117 a,
117 b,
117 c,

199 a,
199
228
184 a,
220 a,

229

230
196
196 a,
218
232
232 a,
220

188
187
194 <*.

218 a,
218 b,
195 b,

233
233 a,
233 b,

Dollars, with interest at five per cent, per annum, payable semi¬
annually. The last six months interest will be paid with this
note. Washington, Dec. 1, 1863. Act March 3, 1863.
Vignette, View of the Treasury.

Coupon of the note, obverse.

Lathe-work counter, obverse of note in tint.

Original lathe-work of counter, C and 100.

Finished do. do.

Cycloid lathe-work tint over obverse of note.

do. do. section of same.

Lathe-work strip over obverse of coupon in tint.

Legal tender for one hundred dollars.

Lathe-work C, reverse of coupon.

do. reverse of note with lettering,

do. original of the reverse,

do. sections do.

do. do. do.

$100 ONE-YEAR INTEREST NOTE.

Obverse.

Vignette, Washington,
do. Justice,
do. Victory and Peace.

United States.

One year after ‘date.

Act of March 3, 1863.

One hundred dollars.

U. S., corner ornaments, scroll and flowers.

do. do.

Counter, lathe-work, 100.

This note is a legal tender for one hundred dollars.
Border, U. S. and C.

Check letters, A B C D.

Washington, in script.

Signatures.

Kegister of Treasury. Treasurer of the United States.

Obverse tint. ,

Lathe-work,
do. C.

Scroll, belonging to tint.

Reverse.

Lathe-work, with lettering and denomination.

Half section of counter.

Section of lathe-work.

350 TWO-YEARS INTEREST NOTE.
Obverse.

No.

197 Yignettc, Caducous.

214 a, do. Loyalty.

199 do. Justice.

185 a, Counter, lathe-work, 50.

185 b , United States.

200 Two years after date will pay to bearer, fifty dollars with interest

at five per.

201 ‘ Cent, per annum, payable semi-annually. Washington. The last

six months interest will be paid with this note.

201 a, Lathe-work counter, 50, section of a circle.

201 b, do. without denomination.

195 a, Act of March 3, 1863.

187 Signatures.

194 a, Register of the Treasury and Treasurer of the United States.

220 Check letters.

208 Coupon, $1 25.

208 a, do.

Obverse tint.

204 Lathe-work tint.

208 a, L, ornamented with scroll.

195 b, Scroll-work, belonging to tint.

210 This note is a legal tender for fifty dollars.

210 a, Treasury note, in tablet.

196 a, Scroll-work corners, U. S.

194 b, Small border, 50 and United States repeated.

206 Pentograph tint over coupon.

Reverse.

212 Lathe-work lettering and denomination.

213 do. fifty dollars, pentograph, coupon.

213 a , do. section of coupon.

$50 ONE-YEAR INTEREST NOTES.

Obverse.

214 Vignette, Loyalty.

234 do. Alexander Hamilton.

185 b, United States.

216 a, Lathe counter, 50.

235 Fifty dollars.

235 a , Lathe counter, fifty.

235 b, Ornamental scroll corner, fifty, 50.

157

195 a,
210 a,
210
188
220
194 a,
187
194 b,

231

241

71a,
71 b,
69

156

157

158

158 a,
155 a,

159

160
161 a,
155 6,
155 c,

162
162 a,

153

154
154 a,
154 b,

154 c ,

155

Act of March 3, 1863.

One year after date, in tablet.

This note is a legal tender for fifty dollars.
Washington.

Check letters, AB CD.

Signatures.

Lathe border, end piece, United States, &c.

Obverse tint.

Lathe-work.

Reverse.

Lathe-work, denomination, &c.

Section of lathe-work.

$20 ONE-YEAR INTEREST NOTE.

• Obverse.

Vignette, portrait of President Lincoln,
do. Victory,
do. do.

do. do.

do. Mortar firing.

Original, lathe-work of corner piece 20.

Finished do. do. do.

Border of note, lathe-work, twenty, 20, repeated.

Section of lathe-work do.

Legal tender for twenty dollars.

Corner ornament, In God is our trust,
do. do. God and our right.

Legend of note.

With interest at five per cent, Washington.

Act of March 3, 1863.

Check letters.

Obverse tint.

Cycloid tint 20, repeated,
do. do. section.

Reverse.

Lathe-work of full note,
do. original.

do. section of same to form border,

do. do. do.

20, XX, repeated.

158

$10 ONE-YEAR INTEREST NOTE.
Obverse.

No.

214 Vignette, Eagle, Flag, and Capitol.

215 do. portrait of Secretary Chase.

215 a, do. Peace.

216 United States, one year after date, act of March 3, 1863.

217 Lathe-work counter, 10.

216 b, do. do. X, ornamented with scroll.

216 c, do. do. X, do. do.

219 Ten dollars, with five per cent, interest.

188 Washington.

187 Signatures.

194 a, Treasurer of the U. S. and Register of the Treasury.

196 Corner ornaments, U. S.

220 Check letters.

221 This note is a legal tender for ten dollars. %

222 United States, ten, 10, repeated.

223 End border, United States of America.

223 a , Section of do. do.

193 Treasury note, in tablet.

Obverse tint.

225 Lathe-work.

226 do. figure X.

Reverse.

227 Lathe-work, with lettering and denomination.

225 a, do. counter, 10.

$1,000 5-20 bond.

45 It is hereby certified that.

59 United States of America, with scrdll border.

60 One thousand dollars.

61 Lathe-work counter, No.

62 Scroll work, belonging to border.

50 a , Lathe-work, one thousand counter.

50 d, do. M, do.

55 Vignette, Farmer mowing.

63 do. Girl at the well.

64 do. Eagle with flag.

64 a, do. do.

64 b, Are indebted unto.

159

■<

65 a ,
65 b,
65 <?,
65 d,
65 e,
65/,
65 g,

65 A,
67

66
83

84
86
87
78

100
100 a.

Section of border, lathe work.

do.

Coupon, $30.

Section of border, lathe-work, coupon.

United States of America, ruled face.

do. do. do.

Lathe-work 1,000, reverse of bond.

Ruled oval counter, fourth series and 4th.

Cycloid counter, $30, reverse of coupon.

Cycloid counter, M and 1,000, with lettering, six per cent, loan,
under act, &c.

Oifb thousand dollars and writing of the bond.

It is hereby certified that the, Treasury Department, Register’s
office, are indebted unto, No
Coupon, $30, obverse,
do. do.

$500 5-20 bonds.

46 United States of America.

46 a , Third series.

47 Rive hundred dollars.

47 a, do. do.

49 Lathe-work counter 3d and third series.

50 do. do. D.

50 b, Six per cent, loan under act of February 25, 1862.

50 <?, Lathe-work counter D, redeemable after five and payable twenty

years from date.

51 Lathe-work counter, five hundred.

51 a, do. do. do.

52 do. do. 500.

53 Vignette, Head of President Lincoln.

53 a, Border belonging to the head of Scott.

54 Vignette, Portrait of Gen. Scott.

55 do. Eagle.

56 Coupon, $15.

57 Lathe-work border of coupon.

58 a, do. do. do.

92 Ruled counter, 4th series and fourth over face.

160

§100 5-20 BONDS.

No. *

15 a, Tablets with legend.

15 b, do. do.

15 c, do. do.

16 a, Register’s office, May.

16 b, Treasury Department, November, No.

17 a, One hundred dollars.

17 b, No.

18 a, The United States of America.

18 b, Are indebted «nto.

18 c, do. do.

18 d, do. doi

19 a, Kaleidograph border, with matched corner.

19 b, do. do. do. do.

19 d, do. do. do. do.

19 c, do. do. do. do.

20 Coupon, §3 00.

21 Vignette, Justice.

22 do. Liberty.

23 do. America offering up her jewels.

24 Original lathe-work of §100 counter.

28 Matched counter, with denomination, finished.

29 Border kaleidograph.

99 Fourth series, black-face letter.

§50 5-20 bond.

34 a, It is hereby certified that.

34 b, The.

34 c, United States.

34 d, Of America.

34 e, Are indebted.

34 c, Unto.

35 fifty dollars.

36 a, Kaleidograph border, with matched corner.

36 b,

do.

37 a,

do.

37 b,

do.

38 Counter, 50.

38 a, Lathe.work, 3d and corner piece, to match border.

39 Kaleidograph counter, 50, 3d series, and Treasury Department.

89 a, do. do. No.

39 b, Third series, No.

40 Vignette, Eagle.

41 do. America and peace.

42 do. Reclining Indian.

161

No.

43 Treasury Department, Register’s office, Register of the Treasury.

44 Coupon, $1 50.

15 d , Tablets with legend.

15 e , do. do.

15/, ' do. do.

15 g , do. do.

89 Coupon, §1 50, 4th series.

89 a , do. do.

89 5, Fourth.

• MISCELLANEOUS STOCK.

77 Scroll work corner piece.

79 It is hereby certified that, Treasury of the United States, Regis¬
ter of the Treasury.

81 One thousand dollars, Washington, No.

81 a, Ruled counter 1,000.

82 If the order blank is not filled this, United States Treasury.

85 Alphabet or check letters.

85 a, do. do.

94 Border strip of lathe-work.

95 a , United States Treasury seal.

90 Signatures of F. E. Spinner and L. E. Chittenden.

98 Fifty dollars, a small black-face letter.

98 a, do. do. do.

102 Draft and $.

118 • United States of America, fancy letter, black face.

151 Interest 5 per cent.

101 Lathe border with strip of cycloid work, mitre corner.

54 a, Small oval head of Gen. Scott.

41 a, America and Peace.

42 a, Reclining Indian.

34/e,It is hereby certified that.

50 e , Small lathe corner piece.

34 d, It is hereby certified that.

170 a , Five thousand dollars, one.

170 Certificate of Indebtedness.

18 a, Are indebted unto.

170 b, Certificate of indebtedness.

75 Engraved and printed at the Treasury Department.

75 a, do. do. do.

30 It is hereby certified that.

81 b, Washington, No., No.

105 a, Dollars, will pay the bearer,

32 Washington, act of March 3, 1863, one hundred in tablet.

174 Lathe and lcaleidograph border.

174 a , Small counter lathe.

162

No.

119 Kaleidograph counter, 1,000.

119 a, do. do.

154a,a,Border, lathe-work.

163a,a, do.

160 a, The United States Treasury.

161 a, Five hundred, Washington,

167atoe$25 coupon belonging to the $1,000 10-40.

168 $5 do. do. $100 10-40.

169 Small lathe-work counter or corner piece.

172 Small lathe-work counter, 50.

173 do. do. 10.

175 do. corner pieces scroll.

176 Lathe-work counter.

177 United States Treasury note.

33 Five per cent, loan under act of March 3, 1863, redeemable after
ten and payable forty years from date.

95 b, United States Treasury seal.

95 <?, do do.

171a, b, $12 50 coupon belonging to the $500 10-40.

178 Corner pieces, $2 50.

176 a, Oblong lathe counter, with white face, 10,000.

181 Section of oval lathe counter.

182

do.

border strip.

181 a,

Lathe strip made up.

182 a,

do.

203

do.

section.

203 a,

do.

202

do.

do. of counter.

164

do.

do. of counter.

236

do.

237

do.

238

do.

sections miscellaneous.

164 a,

do.

240 Lathe-work reverse, $10 one year interest note, bed piece reverse,
$10 3 years.

243 Lathe-work reverse of $100, 1 year lettering erased, to be used

on 3 years interest notes.

245 Lathe-work reverse of $500, 2 year lettering erased to be used on
3 years interest notes.

244 Sections of lathe-work.

244 a, do. do.

238 a, do. do.

210 do. do.

176a,a,Oblong lathe-work.

249 Collector’s office, New York, 186. Pay to the.

249 a, Or del of, in coin, Auditor.

239 a, Issued on requisition, No., Registered, 186.

163

No.

239 b, Pay to, on Treasury warrant, No., 186, or order.

239 c, Treasury warrant, No. 186., pay to, or order, in favor of, on, $.

247 Three years, three years after date.

248 Assistant Treasurer of the United States.

246 "Three years after date, compounded semi-annually.

151 a, Lathe-work counter.

250 Will pay the bearer fifty dollars, with interest at the rate of six

per cent, per annum.

244 a , Section of lathe-work.

251 Three years, with interest at the rate of six per cent, per annum,

compounded semi-annually.

252 Lathe-work, reverse of three-year $50 note, skeleton.

232 a, This note is a legal tender for one hundred dollars.

252 a , Lathe-work, reverse of 50 dollars, three years note, finished.

238 Lathe border strip.

257 $1 50 coupon for the 6, 81, bonds.

258 $3 do. do. do.

151 a , Lathe border strip, mitre.

244 a , do. do.

244 aa, do. do.

259 Cycloid tint for $1,000, 6, 81, coupon 30.

256 Register’s office, Treasury Department.

260 Coupon for $15, 6, 81, bonds.

261 do. $30 do. do.

238 a , Lathe border strip, mitre.

238 aa, do. do.

255 Six months interest due July 1, 1881, payable with this bond.
255 a , Entered, recorded, Washington.

263 Vignettes, oval, Washington, Mortar firing, Victory.

262 Cycloid tint for $500, 6, 81, coupon 15.

203 aa, Lathe border strip, mitre.

265 Coupon, blank dollars.

264 a, Fifty, cycloid face, fancy letter.

267 Coupon, cycloid tint, with lettering act of March 3, 1863.

88 Counter, 50 dollars, 100 dollars, 500 dollars with lettering, Treas¬
ury Department, National Currency Bureau, and official business.
273 a, With interest at the rate of six per cent, per annum, compounded
semi-annually, Washington.

273 b, Three years after date, act of July 2, 1864.

274 Counter lathe-work on two sections forming an oval.

281 $500 reverse, 7-30.

276 Lathe-work border.

276 a, do. do.

277 $1,000 white lathe work, oblong counter.

277 a, do. do. section of cirate.

50 i, Lathe counter.

275 Five hundred dollars, white face letter.

164

No.

275 a, Fifty thousand, one, ten, ■white face letter.

66 a, Lathe-work border.

278 Act of June 30, 1864.

279 Five coupons attached, last six months interest payable with note.

273 Three years after date.

154 Lathe border.

281 a, $500 reverse, with legend for 7-30.

154 a, Lathe border, mitred.

283 $20, reverse for the $20 three years interest notes.

280 Act of June 30, 1864, interest one cent per day, two cents per

day, &c.

280 a, Interest one dollar per day.

280 b, Interest ten cents per day, interest 20 cents per day.

284 Double lathe-work counter 1,000

285 Lathe section of circle, 1,000.

288 $100 reverse 7-30 with legend.

289 Compounded semi-annually.

290 Coupon for 7-30, $500, $18 25.

290 do. do. $100, $3 65.

291 do. do. $1,000, $36 50.

291 do. do. $50, $1 82J.

292 At maturity, &c., in a small lathe border for reverse $1,000, 7-30.

296 Act of July 17 and August 5, 1861.

294 a, Semi-annually in lawful money.

294 Payable, interest, semi-annually.

295 S. B. Colby, signature.

293 Three years after date, black face letter.

295 a, S. B. Colby, signature.

297 $5,000 coupon for 7-30.

186 a, Five hundred dollars.

46 b, United States.

298 The United States of America.

299 The United States of America, ruled face.

300 do. do. do. black face.

301 Act of June 30, 1864, in tablet.

302 Six per cent, loan under act of June 30, 1864, in tablet.

54 Head of General Scott.

303 a, Promise to pay to the order with 7-30 per cent, in lawful money.
303 by February 15, August 15.

303 c, Semi-annually, Aug. 15, 1864, semi-annually.

304 Six per cent, loan under act of June 30, 1864.

305 United States of America, ornamented with stars.

308 Six months interest due November 1, 1864, payable with this

bond.

309 a, Washington, dollars to the order, promise to pay.

309 b, August 16, 1864.

309 e, 7-30 per cent, interest payable semi-annually, &c.

165

No.

310 United States of America, black face letter.

311 Fifty dollars, black face letter.

213 a, Portrait of Secretary Fessenden

312 Promise to pay to the bearer, &c.

316 'Sectional roll of lathe-work.

317

do.

318

do.

319

do.

320

do.

and counter 25.

322 Sectional roll taken up for 25 cents reverse, new Fractional
Currency.

324 Head of Washington and sections of lathe-work.

326 Lathe counter.

328 Lathe counter with denomination 3.

GEO. W. CASILEAR,

Custodian.

INVENTORY OF NOTE AND BOND PAPER,
On hand October 1, 1864.

596.500 sheets, fourteen by seventeen inches.

73,000 sheets, fourteen by nineteen inches.

109.500 sheets, fourteen by twenty inches.

134,000 sheets, fifteen and a half by seventeen inches.

110,000 sheets, fifteen by twenty-two inches.

4,000 sheets, seventeen by twenty-seven inches.

31.500 sheets, eighteen by twenty-three inches.

220,000 sheets, sixteen and a half by twenty-eight inches.

22.500 sheets, eighteen by twenty-eight inches.

166

Extract from Report of Special Committee.

The folio-wing extract from the testimony taken by the Special Com¬
mittee of Congress, of which the Hon. Mr. Garfield was chairman, will
show the actual expenditure up to the date at which the testimony was
taken; and also show, approximately, the savings effected by this Divi¬
sion during the period it had then been in existence:

Thursday, May 19, 1864.

Spencer M. Clark, being recalled, stated as follows:

In answer to the Committee’s inquiry as to the amount expended in
printing in the Treasury Department, as compared with the amount ex¬
pended by the Bank Note Companies, I have to say that the entire amount
expended for all purposes since the Bureau of Engraving and Printing
was first started, a period of twenty-one months, is $555,297 57. This
includes all payments for engines, machinery, fixtures, presses, materials,
labor, &c., &c., as well as all the outlays made in preparation for print¬
ing the National Currency, which was subsequently determined by the
Comptroller of the Currency should be done by the Bank Note Com¬
panies. It includes all expenditures for paper, printing, ruling, separat¬
ing, sealing, &c., done for the work printed in the Department as well as
for that printed in New York.

The amount paid to the Bank Note Companies during the correspond¬
ing period of twenty-one months, was $2,198,499 99. The difference in
expenditures between Washington and New York, for twenty-one months,
therefore, is $1,643,202 42. We have received from the Bank Note
Companies nothing but the printed notes. The steel plates, rolls, dies,
&c., are still retained by the Companies; while for the amount expended
by the Department in Washington, we have on hand the engines, ma¬
chinery, fixtures, steel plates, and other engraving stock, &c., as well as
a large amount of paper and other raw material on hand.

The amount paid the companies was for engraving, printing, and paper,
only, as follows:

For engraving. $232,160 50

For printing. 1,779,398 82

For paper. 186,940 67

2,198,499 99

The amount expended for the same items at the Department has been—

For engraving. $28,800 00

For printing. 82,129 52

For paper. 3d’526 00

145,455 52

Difference in favor of the Department $2,053,044 47, and the stock
on hand.

The amount of notes and securities printed by the Bank Note Com¬
panies during the twenty-one months was $725,000,000. The amount
printed at the Department during the same period was $850,000,000.

167

Remarks by the Hon. Jas. A. G-arjield.

In the course of debate in the House of Representatives on House Bill
No. 649, making appropriations for the legislative, executive, and judicial
expenses of the Government for the year ending June 30,1866, the Hon.
Mr. Garfield, of Ohio, formerly Chairman of the Special Committee, said,
as reported in the Daily Globe :

“ In regard to the dry plate-printing to which the gentleman has re¬
ferred, the Committee did report that the machinery was very heavy and
expensive, that the experiment had not yet been completed, and that
they could not recommend the system on the score of economy. It seemed
to us to be an expensive experiment, and one of doubtful success. But
since that time the experiment has proved highly successful. I think
there can scarcely be found an instance of so marked a success in any
branch of mechanical ingenuity as this experiment in dry plate-printing.
If the gentleman will visit the Treasury Department, he will find that
printing is there executed far faster by this method than by the old
method; and not only faster, but far better. The printing is executed
in such a way as to afford almost an absolute security against counter¬
feiting. Within the past few months one of the most accomplished engi¬
neers of England has visited the printing establishment of the Treasury
Department, and he declares the printing machinery now in use there to
be a masterpiece of skill in mechanics. And I am informed to-day by a
gentleman on this floor that Professor Agassiz, who has witnessed the
operation of that machinery within the past week, pronounces it one of
the wonders of the age—one of the marvels of mechanical science.

These facts, which have come to light since the Committee made their
report, constitute, I think, a triumphant vindication of the genius of the
man who has perfected this mechanism, whatever may be said against his
personal character. I hope these facts will convince the House of the
impropriety of retaining an amendment which would throw a reflection
upon the whole system.”

168

Letter from Chief Justice Chase.

After the first publication of this Report the following letter was re¬
ceived from Chief Justice Chase, read on the floor of the Senate by the
Hon. Senator from New Hampshire, and published in the Daily Globe :

Washington, February 6,1865.

Spencer M. Clark,

Chief First Division National Currency Bureau.

My dear Sir : I have read with much interest, and all the care my
duties allowed, your report to Secretary Fessenden on the operations of
your Division of the National Currency Bureau. I am glad you have
prepared this complete vindication of the system of bond and note en¬
graving, printing, and preparation for issue in the Treasury Department.
Strange that a system which saves millions of dollars should need any.

Perhaps no one can appreciate your services as I do; for, as I author¬
ized the system and put on you the work of organization and practical
operation, I naturally observed your action with much anxiety. I saw
what difficulties you encountered and'overcame, amid predictions of failure
and impeachment both of motive and conduct which hardly any other
man could or would have endured. My own faith at times almost gave
way. Nothing enabled me to persevere but your perseverance.

Looking back now, and seeing what great benefits have been secured
to our country, I greatly rejoice that though sometimes much discour¬
aged, I did not give up. Not many, it is true, will ever understand
what has been done; but the work is there, and a few know it.

The greatest part—by far the greatest part—is yours, and your best
reward is consciousness. But I trust consciousness will not be your only
reward. I still hope that your services will be suitably acknowledged by
Congress and the Government. Were I yet Secretary, you should at
least have as much honor as a Secretary’s report could give.

Sincerely your friend,

S. P. CHASE.

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Full text of "Report to the Secretary of the Treasury from the first division National Currency Bureau: showing its origin, growth, and present condition, with details of work done, &c."

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